MARKET REPORT
THE London market’s relief rally continued yesterday as concerns over North Korea eased and blue-chip mining stocks surged on robust economic data from China.
The FTSE 100 Index closed up 65.36 points to 7,430.62, as European stocks regained lost ground as the sell-off sparked by American’s stand-off with Pyongyang appeared to have run its course.
The top-flight was also bolstered by London-listed mining companies, thanks to better-than-expected Chinese manufacturing figures.
Anglo American was among the biggest risers up 38.5p to 1,402.5p, while Antofagasta was 20p higher at 1,035p and Rio Tinto climbed 67.5p to 3,746.5p.
Across Europe, Germany’s Dax was up 0.4% and the Cac 40 in France rose 0.6%,
David Madden, market analyst at CMC Markets UK, said: “Equity markets in Europe are extending yesterday’s rally as the nervousness surrounding North Korea has waned for now.
“Make no mistake, the stand-off between Pyongyang and Washington DC is still ongoing, but while tempers are somewhat at a standstill, the bullish sentiment will continue.
“Traders are using the halt in hostilities as an opportunity to pick up stocks, but how long will the buying momentum last?”
On the currency markets, the pound was down 0.3% against the US dollar at 1.288 after Bank of England official Michael Saunders said a “modest” interest rate hike is needed to curb surging inflation.
Mr Saunders, one of the Bank’s Monetary Policy Committee (MPC) members who has recently voted to raise rates, said an increase would “help ensure a sustainable return of inflation to target over time”.
Sterling was also 0.2% off versus the euro at 1.08.
The price of oil soared 3.5% to 52.51 US dollars a barrel after Opec confirmed that coordinated production cuts in August had a compliance rate of 96%.
The outcome boosted attempts by the cartel to support prices by curbing the global supply glut.
In UK stocks, Ladbrokes Coral pushed ahead after the blockbuster Floyd Mayweather vs Conor McGregor boxing match became its biggest betting event outside of the Grand National.
The biggest risers on the FTSE 100 Index were Mediclinic International up 21.5p to 764.5p, Anglo American up 38.5p to 1,402.5p and Hargreaves Lansdown up 37p to 1,400p, Whitbread up 96p to 3,758p.