Home | Breaking News | FTSE outperforms as mining sector hits 4-month high
A man shelters under an umbrella as he walks past the London Stock Exchange in London, Britain August 24, 2015.REUTERS/Suzanne Plunkett

FTSE outperforms as mining sector hits 4-month high

WT24 Desk

Britain’s mining index climbed to a four-month high on Friday, with a rally in prices of major industrial metals boosting shares in companies such as Glencore (GLEN.L), Anglo American (AAL.L) and BHP Billiton (BLT.L), Reuters reports.  Copper stayed on track for its biggest weekly advance in about six months on signs of an end to the slide in oil prices. Prospects of a stronger U.S. economy also fuelled investor appetite for metals. [MET/L]

Shares in Glencore, Anglo American, BHP Billiton, Antofagasta (ANTO.L) and Rio Tinto (RIO.L) rose between 3.6 percent and 6.1 percent, helping the sector index .FTNMX1770 up 4.3 percent and taking 2016 gains to more than 26 percent.

“Miners are having a great run as some investors believe that stronger metals prices may change the fate of the basic resources sector,” Securequity senior trader, Jawaid Afsar, said. “However, the sector remains vulnerable in the near-term as the recent rally may prompt some people to book profits.”

Miners helped the FTSE 100 .FTSE gain 0.8 percent, rising to 6,177.05 points by 1136 GMT and outperforming the wider European stock market. The UK stock index has surged about 12 percent since hitting a multi-year low last month, and is set for its third week of straight gains for the first time in 2016.

Among standout gainers, shares in budget airline easyJet (EZJ.L) rose 3.3 percent after saying passenger numbers rose 9.8 percent in February. On the downside, asset manager Schroders was down 2.2 percent after a downgrade from Citigroup to “neutral” from “buy”, citing challenging markets and the company’s comments on future investment.

Whitbread (WTB.L) also retreated 1.5 percent as leading investment banks and brokers including Barclays, HSBC, Societe Generale, Credit Suisse and Kepler Cheuvreux cut their price targets for the stock.

Investors are focused on U.S. employment data due at 1330 GMT. U.S. employers are likely to have stepped up hiring in February, in a sign of labour market strength that could further ease fears the economy is heading into recession.

“Whilst a stronger than expected number indicating a very healthy job market is unlikely to spark the Fed into action any time soon, traders will consider this as an indication that the U.S. economy is likely to remain healthy and continues to expand in 2016,” City of London Markets trader, Markus Huber, said.

“Once today’s data is out of the way, main focus will switch over to next week’s ECB meeting with expectations of major new measures to stimulate growth and combat low inflation still growing,” he said.

 

Leave a Reply

Your email address will not be published. Required fields are marked *

*

%d bloggers like this: