Min­ers re­ceive lift as China digs deep

The Daily Telegraph - Business - - Business - Louis ash­worth

LON­DON’S min­ers lifted the FTSE 100 yes­ter­day as Chi­nese re­lief mea­sures pushed up metal prices and gold shifted up­wards once more.

Base me­tals such as cop­per, alu­minium, nickel, zinc and iron all rose af­ter the Peo­ple’s Bank of China added 700bn yuan (£77bn) of stim­u­lus to the coun­try’s com­mer­cial lenders, sup­port­ing the man­u­fac­tur­ing-heavy econ­omy.

Di­ver­si­fied min­ers ben­e­fited strongly for the broad-based climb. An­glo-Amer­i­can led the group, ris­ing 53.2p to £19.32, while BHP and Glen­core all also gained ground.

Royal Bank of Canada an­a­lysts said China’s re­cov­ery has helped min­ing stock shake off the pan­demic price hit: “A quick re­cov­ery in China and sup­ply dis­rup­tions have driven me­tals prices and the eq­ui­ties mostly back above pre-Covid lev­els in Jan­uary.”

They warned that mo­men­tum “seems to be fad­ing” in share prices, how­ever.

The climb was enough to lift the FTSE 100 above Euro­pean peers dur­ing a sleepy ses­sion which saw con­tin­ued pres­sure on travel stocks.

Pre­cious metal min­ers also per­formed strongly as the price of gold edged higher fol­low­ing a dip over re­cent weeks la­belled a “long over­due correction” by Saxo Bank’s Ole Han­son. Poly­metal rose 57p to £20.34 while Fres­nillo climbed 28.5p to £12.51, a rise of 2.3pc.

Other blue-chip ris­ers in­cluded Right­move, which climbed 10p to 631.4p af­ter say­ing homes sales reached a record level fol­low­ing a “mini-boom” be­tween mid-July and early Au­gust. The prop­erty plat­form said the climb was caused by pent-up pan­demic de­mand, and Lon­don­ers look­ing for an es­cape to the coun­try.

Travel stocks con­tin­ued to feel the brunt of losses, with Bri­tish Air­waysowner IAG tak­ing up an in­creas­ingly fa­mil­iar spot as the in­dex’s big­gest faller, down 10.3p to 184.25p. Premier Inn-owner Whit­bread dropped 2.4p to £23.85, while In­ter­Con­ti­nen­tal Ho­tels fell 100p to £40.48.

It was a sim­i­lar story on the FTSE 250, with easyJet, Car­ni­val and Tui all among the big­gest fall­ers. EasyJet dropped 26.20p to 544.6p af­ter con­firm­ing it would close three of its air­port bases, as bud­get peer Ryanair cut down on its Septem­ber and Oc­to­ber flight plans fol­low­ing a dip in de­mand. Citi an­a­lysts opened a neg­a­tive cat­a­lyst watch on the car­rier, warn­ing “the com­pany met­rics will strug­gle and de­te­ri­o­rate in the af­ter­math of the in­creased quar­an­tine re­stric­tions en­acted by the UK on Fri­day”.

Min­ing group Petropavlo­vsk led mid-cap ris­ers af­ter a se­ries of man­age­ment changes. The group named Mak­sim Meshcheri­akov as its new in­terim chief ex­ec­u­tive, and James W Cameron Jr as its chair­man.

Cran­swick shares rose 252p to £40.76 af­ter the pork pro­ducer said it an­tic­i­pates re­sults ahead of its pre­vi­ous ex­pec­ta­tions.

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