UK stocks climb on boost from auto, mining stocks after upbeat data

British stocks ended higher on Thursday, helped by auto stocks and mining shares, while data showing the domestic economy was on the verge of exiting recession further aided the mood.

The blue-chip FTSE 100 rose 0.5% to close at its highest level since Feb 2023, while the more domestically focused FTSE 250 gained 0.6%.

The automobiles and parts index led sectoral gains with a 2.4% rise after data showed Britain’s new car market recorded the best March since 2019 on the back of steady demand for fleet vehicles.

Precious metal miners gained 1.4% as the bullion scaled a fresh record high, while industrial metal miners rose 1.6% as copper prices rose to a 14-month high.

The commodity-heavy FTSE 100 index has recently benefited from a rally in copper, gold and oil prices, although it lags other developed economy peers which have clinched record highs this year.

Data indicating a U.S. soft landing and China recovery combined with a weaker Sterling should continue to boost UK exporters, said Morgane Delledonne, global head of investment strategy at Global X ETFs Europe.

“Lots of investors were waiting for a dovish pivot from the Bank of England (BoE) to take opportunities in attractively valued UK stocks.”

The Bank of England is expected to follow other major central banks and cut interest rates in June or August as the latest data indicated an improving economy.

Two separate surveys on Thursday showed British companies’ were expecting selling prices and wage increases to cool in the year ahead in March, while the British economy looked on track to exit recession when official growth data is next published.

A senior analyst with S&P Global Ratings said whoever wins the British election expected later this year will have to tread carefully to avoid jeopardising the country’s already diminished credit rating with public finances under heavy strain. Among individual stocks, Future Plc jumped nearly 16% to the top of the FTSE midcap index after the media firm said it expects to return to organic revenue growth in the second quarter.

Ocado slid 5% after the online supermarket said Chairman Rick Haythornthwaite will step down next year due to his “increasing commitment” at banking group NatWest. NatWest shares gained nearly 3%.

British stocks edged higher on Thursday supported by a rise in precious metal miners, while caution prevailed ahead of a slew of domestic and global economic data for cues on the interest rate path. As of 7:11 GMT, both the resource-heavy FTSE 100 and the more domestically focused FTSE 250 rose 0.1%. Precious metals miners advanced 0.7% as gold prices reached a record high.

Meanwhile, investors grew cautiously optimistic after a report showed US services industry growth slowed further in March, while Federal Reserve Chair Jerome Powell reaffirmed rate cuts are coming if data pans out as the central bank expects. FTSE 100 hits 3-week high as cool labour data fuels rate-cut bets

The UK services PMI data for the month of March is due later on Thursday. Among individual stocks, Cab Payments gained 11.6% after the fintech company got a payment service provider licence in the Netherlands.

British stocks closed sharply higher on Wednesday, with homebuilders notching their biggest percentage gain since 2008 after signs of slowing inflation helped to bolster hopes of peaking UK interest rates.

The domestically oriented FTSE 250 index outperformed with a 3.8% jump, its best session in more than eight months.

The internationally focussed FTSE 100 rose 1.8% to hit a one-month high.