Sector movers: Mining and metals stem market declines

Basic resource stocks helped to prop up London markets against bigger declines on Wednesday, after Morgan Stanley lifted its view on the European metals and mining sector.

The FTSE 100 ended up nearly flat, down 0.01% or 0.47 points lower at 6,325.69, while the FTSE 250 was 0.67% or 114.16 points lower at 17,018.66.

At 1441 BST, the Brent front month futures contract was up 1.14% or 59 cents to $52.51 per barrel extending the previous session’s rally and climbing as high as $52.94 at one point. WTI futures, up 0.99% or 48 cents to $49.01, followed Brent in extending the uptick overnight, after the US Energy Information Administration suggested the country's oil production rate would moderate over the course of 2016.

Past the midway point of the LME session, three-month delivery contracts of primary aluminium (up 1.5%), lead (up 2.1%), nickel (up 3.3%), tin (up 2.7%), copper (up 1.6%) and zinc (up 2.4%) were heading higher, also helping push up industrial metal companies’ stocks.

Morgan Stanley upgraded its stance on Anglo American, Rio Tinto and BHP Billiton. It also commented on the overall sector and said stable data from China in the last few months with a potential uplift from recent financial and administrative stimulus policies should increase conviction that the 19% commodity price uplift by 2017 in the bank’s base-case price deck is achievable.

Risers on the FTSE 250 also came from the sector, with Vedanta Resources, Kaz Minerals and Evraz pushing the market up.

Energy stocks also put in a solid performance on the FTSE 250 as oil prices resumed their upward trajectory from Tuesday when they surged after the American Petroleum Institute reported a weekly US crude stockpile draw of 1.2m barrels. Tullow Oil, Premier Oil and Ophir Energy all racked up healthy gains.