Blue chips lead advance by Footsie

A 1.4% bounce today left the FTSE 100 index back within sight of record territory as London traders shrugged off the latest Wall Street tech jitters.

A run of strong blue-chip earnings and optimism that the Federal Reserve will tonight open the door to a September rate cut underpinned the rise.

Today’s charge of 114.69 points to 8389.10 rounded off a strong end to July, with the FTSE 100 up 4% since Thursday morning and within 100 points of May’s intraday high.

Mining stocks led the advance as Anglo American and Antofagasta rallied 4% on signs that China’s political leaders will step up support for their struggling economy.

Iron ore specialist Rio Tinto rose 87.5p to 5023p after interim annual results included an unchanged dividend of 177 US cents a share, equivalent to 50% of earnings.

Other strong performers included Shell, which improved 2% or 56.5p to 2823p ahead of results tomorrow.

Tech investor Scottish Mortgage also lifted 12p to 858,2p as traders took a relaxed view of last night’s Wall Street’s tech sell-off.

Nvidia shares closed 7% lower and the wider Magnificent Seven down by 2% ahead of mega cap results from the likes of Apple, Amazon and Meta Platforms. Microsoft posted earnings after the closing bell that beat hopes, but its shares were marked 7% lower at one point due to slightly slower cloud services growth.

Hargreaves Lansdown analyst Matt Britzman said investors needed to remember that megatrends such as AI take time and rarely track in a perfect line. He added: “Names like Microsoft had been priced assuming a near-perfect transition to an AI-dominated world. This is a healthy adjustment of near-term expectations, not the end of the AI trade.”

The FTSE 250 index lagged the commodities-fuelled performance of the top flight but still rose by 0.7% or 139.20 points to its highest level in over two years at 21,571.71. Strong mid-cap performers included British Land, which put on 7.4p to extend gains for the past week to 7% at 414.2p.