Market overview: Stocks recover half of Tuesday's losses

1630: Close Stocks bounced back on Wednesday, recovering roughly half the previous day's losses. EasyJet and IAG led on the upside following positive comments out of Morgan Stanley. A slight stabilisation in commodity prices - despite weak data out overnight from China - helped matters. Three-month copper futures gained 0.6% to reach the $5,092.50 per metric tonne mark on the LME. Analysts at Citi forecast a gradual recovery for most commodities in 2016, although further downside might still be on the cards for the fourth quarter. However, “the likelihood and severity of a hard landing in China remains highly uncertain for now and would pose a significant risk to the global economy,” the Commodities Strategy team led by Edward L.Morse said in a research report sent to clients. On the whole however they were more upbeat than RBS, who told clients it expected the crisis to accelerate. FTSE 100 up 96.40 points to 6,032.24.

1530: Commercial US crude oil inventories declined by 1.9m barrels over the seven days ending on 18 September, according to the Department of Energy. US oil output rose by 0.21% to reach 9.14m barrels of oil per day, the same data reveals.

1500: Markit's US manufacturing sector PMI was unchanged for the month of April at a reading of 53 (consensus: 52.8).

1409: "We believe this crisis will accelerate, and that the slowdown in China will particularly hurt undiversified, commodity-dependent satellite economies (Brazil, Australia). In turn, this may spill-over to volatility into USD credit markets, where EM and EM-exposed corporates account for over 10% of indices," writes Alberto Gallo at RBS.

1256: Despite recent sharp falls, for most commodity prices it was hard to argue that a trough had been reached for the year, according to one of the world’s largest brokers. Nonetheless, the most likely scenario according to the broker was for the economic policies put in place by the People’s Republic of China would boost the economy by year end with a positive impact on energy, industrial commodities, and bulks, with the exception of iron ore.

1255: Three-month copper futures on the LME are edging higher by 0.5% to $5,106.50 per metric tonne.

1206: Analysts at Morgan Stanley have upped their target prices for shares of IAG and easyJet to 1000p from 915p and to 1980p from 1910p, respectively. Its recommendation for both stocks is 'overweight'. "Besides 3Q15 trading momentum we see further opportunities for synergies, costs, cash flow and product leverage to be presented at CMD on Nov 6," the broker said about IAG.

1145: “Glencore remains the mining major most geared to a recovery in commodity prices. For investors anticipating the bottom will be seen in the next 6-12months, the current price level could prove an attractive entry point, but the downside risks also remain high. We stick with our 50:50 PER/NPV-based valuation, but now apply a 40% ‘haircut’ for risk (setting a target price 125p), and move to Hold.”

0944: The top flight is managing to bounce back at the start of the session despite the losses sustained overnight on Wall Street and a weaker than expected reading on Chinese manufacturing. Smiths Group is leading early gains on the back of its full-year results, alongside sharp gains in IAG and easyJet. Out on the second-tier index Premier Oil is at the top of the leaderboard on the heels of higher than forecast full-year production figures. Kaz Minerals and Petra Diamonds were bouncing back from recent weakness. An upgrade out of Investec on Glencore caught traders’ attention in the pre-open. FTSE 100 up 49.21 to reach 5,985.10