Jul. 2--Britain's largest housebuilder Taylor Wimpey not only got a leg up from Bank of America/Merrill Lynch but attracted buyers on the back of major disposal rumours.

The shares erected a gain of 2 1/2p to 36p after the US broking giant upgraded to buy from neutral, saying the current share price is discounting a worse-case scenario for land and writedowns.

But it was industry gossip that it plans to sell its extensive North American housebuilding operations, which include the Monarch, Taylor Woodrow and Morrison Home brands, which really got punters interested.

A sale of its North American operations would help further reduce its debt mountain which still stands around £1bn even after May's £533m rights issue at 25p. The merger of Taylor Woodrow and George Wimpey left the enlarged group massively in debt and the ensuing recession and worldwide housing slump made its financial position much worse.

The North American housing market appears to be on the mend. Taylor Wimpey recently reported good progress in net reservation rates and cancellation rates since the end of April. The order book there has also improved to £510m from £465m and pricing is generally stable.

Rival housebuilder Persimmon also erected a 5 1/4p gain at 355 1/2p after Merrills upgraded to buy, believing the stock has been oversold.

News that China's manufacturing growth accelerated in June, for the third consecutive month, boosted hopes that demand for metals may be recovering. That helped mining stocks push the Footsie 91.5 points higher to 4,340.71. Wall Street's opening gain of 110 points following upbeat economic data also helped London's cause.

As the copper price improved, Vedanta Resources led the charge with a gain of 127p at 1416p. Antofagasta added 37p at 593 1/2p, Eurasian Natural Resources 40p at 662 1/2p and Xstrata 36p at 663.10p.

International Power sparked 15 3/4p higher to 248p after announcing the sale of its Czech business to the investment firm J & T for £581m. Analysts said the sale helps ease concerns over re-financing in 2010.

Following its decision to exercise an option to increase its stake in Gold Resources Corporation by a further 5m shares for £12m, gold and silver producer Hochschild jumped 28p to 276 1/2p. It will then hold 23.9pc.

Pubs group Marston's frothed up 8 1/2p to 127 1/4p on whispers in the trade that Greene King (23 1/4p better at 387 3/4p) could be interested in launching a bid for the company. Pedigree beer group Marston's last month launched a heavily discounted rights issue to raise £176m to expand.