London midday: UK stocks surge on PBoC stimulus, ECB hopes
UK stocks jumped on Friday as resources shares raced ahead after China's central bank surprised the market with its first interest-rate cut in two years in an effort to boost growth.
Anglo American
2,423.00p
08:05 07/10/24
Antofagasta
1,973.50p
08:04 07/10/24
BG Group
n/a
n/a
BHP Group Limited NPV (DI)
2,316.00p
08:05 07/10/24
BP
417.70p
08:05 07/10/24
Centrica
118.25p
08:05 07/10/24
Fresnillo
635.00p
08:05 07/10/24
FTSE 100
8,302.70
08:05 07/10/24
Glencore
434.30p
08:05 07/10/24
Ophir Energy
57.50p
16:39 21/05/19
Rio Tinto
5,277.00p
08:05 07/10/24
Salamander Energy
79.50p
16:30 19/01/17
Shell 'A'
1,895.20p
17:05 28/01/22
Standard Chartered
830.20p
08:05 07/10/24
TP Icap Group
232.00p
08:05 07/10/24
Tullow Oil
25.36p
08:04 07/10/24
After falling for the last two sessions, the FTSE 100 was up 0.8% at 6,733 by midday with the heavyweight mining and oil sectors providing a boost.
The People's Bank of China (PBoC) lowered its one-year deposit rate from 3% to 2.75% and its one-year lending rate from 6% to 5.6%. It also freed up deposit rates, raising the ceiling for rates that banks can pay depositors.
The move came one day after HSBC data showed that activity in China's manufacturing sector stagnated in November, with the purchasing managers' index falling to the break-even point of 50.
"The Chinese government have obviously decided to act on the front foot and prevent the manufacturing sector dropping into contraction," said analyst Jasper Lawler from CMC Markets.
Also boosting sentiment were comments from European Central Bank president Mario Draghi who said that the central bank was ready to expand its asset purchase programmes if inflation remains too low for too long.
During a speech in Frankfurt, Draghi said the ECB will "do what we must to raise inflation and inflation expectations as fast as possible".
Stocks on Wall Street were set to open higher after both the Dow Jones Industrial Average and S&P 500 set new all-time closing highs on Thursday. Stock futures in pre-market trade were up 0.7% across the board in New York.
Mining and oil stocks surge
Stimulus efforts by the central bank of the world's top metals user, China, gave mining stocks a boost on Friday as hopes over demand increased. Rio Tinto, Anglo American, BHP Billiton, Glencore, Antofagasta and Fresnillo were leading the charge, rebounding after some heavy losses the previous session.
Asia-focused bank Standard Chartered was also among the top risers on the FTSE 100.
Oil and gas groups were also performing well as crude prices continued to recover after hitting multi-year lows last week. West Texas Intermediate oil was poised for its first weekly gain since September as investors continued to speculate about whether OPEC will cut output at its meeting next week. Tullow Oil, BP, Shell and BG Group were all putting in decent gains.
Broker Westhouse Securities was also giving stocks in the oil and gas sector a lift, calling for investors in the sector to be a "bit more patient" amid depressed oil prices. Following a recent sell-off, "there is now an opportunity to cherry-pick stocks at large discounts", it said.
Meanwhile, Salamander Energy and larger counterpart Ophir Energy confirmed details of a possible takeover valuing Salamander at around £300m, a premium of 44.5% to its closing price prior to discussions. Salamander's shares were making gains, while Ophir's stock price slumped as it also gave a disappointing update on operations in Tanzania.
Tullett Prebon, the inter-dealer broker, was also trading firmly lower after the company announced a placing to help fund the acquisition of PVM Oil Associates, expected to be completed next week. The placing, set to raise over £32m, is expected to be priced at 248p per share, a steep discount to Tullett's share price on Thursday.
British Gas owner Centrica was extending losses after a profit warning on Thursday, as the company lowered its earnings forecast on the back of mild weather.
Market Movers
techMARK 2,887.00 +0.59%
FTSE 100 6,732.64 +0.80%
FTSE 250 15,701.95 +0.62%
FTSE 100 - Risers
Tullow Oil (TLW) 500.50p +4.86%
Rio Tinto (RIO) 2,979.00p +3.98%
Standard Chartered (STAN) 943.20p +3.74%
BHP Billiton (BLT) 1,639.50p +3.60%
Anglo American (AAL) 1,340.00p +3.59%
Antofagasta (ANTO) 718.50p +3.08%
CRH (CRH) 1,460.00p +2.89%
Glencore (GLEN) 332.50p +2.80%
Fresnillo (FRES) 743.50p +2.55%
Hargreaves Lansdown (HL.) 1,000.00p +2.15%
FTSE 100 - Fallers
Royal Mail (RMG) 422.40p -1.70%
Imperial Tobacco Group (IMT) 2,896.00p -0.96%
Reckitt Benckiser Group (RB.) 5,145.00p -0.87%
Bunzl (BNZL) 1,746.00p -0.80%
Centrica (CNA) 292.20p -0.58%
easyJet (EZJ) 1,556.00p -0.58%
Associated British Foods (ABF) 3,103.00p -0.51%
SSE (SSE) 1,589.00p -0.50%
Dixons Carphone (DC.) 420.80p -0.43%
Shire Plc (SHP) 4,452.00p -0.38%
FTSE 250 - Risers
Micro Focus International (MCRO) 1,117.00p +5.38%
Evraz (EVR) 144.30p +4.11%
Supergroup (SGP) 844.00p +4.00%
Vedanta Resources (VED) 781.50p +3.92%
Hochschild Mining (HOC) 103.00p +3.78%
Kaz Minerals (KAZ) 245.40p +3.72%
Paragon Group Of Companies (PAG) 382.10p +3.72%
Lonmin (LMI) 185.30p +3.64%
Crest Nicholson Holdings (CRST) 353.10p +3.61%
JD Sports Fashion (JD.) 447.90p +3.39%
FTSE 250 - Fallers
Serco Group (SRP) 166.10p -7.21%
Ophir Energy (OPHR) 169.10p -6.11%
Tullett Prebon (TLPR) 255.60p -4.63%
TalkTalk Telecom Group (TALK) 284.90p -2.90%
Mitchells & Butlers (MAB) 351.90p -2.25%
Amlin (AML) 429.50p -1.85%
Thomas Cook Group (TCG) 136.00p -1.66%
IP Group (IPO) 199.70p -1.43%
SSP Group (SSPG) 246.80p -1.28%
Infinis Energy (INFI) 214.50p -1.15%Stocks