MARKET REPORT: Miners rally as China vows to boost economy

Mining stocks drove the London market higher yesterday as China signaled an era of lower interest rates was approaching for the first time in 14 years.

Rio Tinto rose 3.8 per cent, or 189 pence, to 5,113 pence, Anglo American rose 2.7 per cent, or 66.5 pence, to 2,531 pence, Glencore gained 4.5 per cent, or 16 pence, 85 pence, to 394.85 pence and Antofagasta closed up 4.9 per cent, or 85 pence. higher at 1815.5p – all in the hope of a stronger economy Growth in China will boost demand for raw materials such as iron ore and copper.

The rally in the important mining sector helped the FTSE 100 rise 0.5 per cent, or 43.47 points, to 8,352.08, even as investors battled fresh turmoil in the Middle East following the fall of Syrian President Bashar al-Assad.

The FTSE 250 was down 0.05 per cent, or 9.73 points, at 21,049.27.

While the regime change in Syria reverberated around the world, it was events in China that gave direction to the markets.

With the world’s second-largest economy in need of a boost, Beijing said it will “implement more proactive fiscal policies and moderately flexible monetary policies” starting next year.

It was the first time China has signaled “loose” monetary policy – ​​or lower interest rates – since 2010, when it sought to support a recovery from the global financial crisis.

“We should vigorously boost consumption, improve investment efficiency and widely expand domestic demand,” state news agency Xinhua quoted officials as saying.

The prospect of an economic recovery in China – combined with uncertainty in the Middle East – also sent oil prices higher, with Brent crude rising more than 1 percent to $72 a barrel.

Other London-listed shares exposed to China gained, with Prudential gaining 2.9 percent, or 19.2 pence, to 681.4 pence, Standard Chartered adding 1.6 percent, or 15.6 pence, to 989 .2p and Burberry rose 4.3 per cent, or 40.2p. at 970p.

Burberry also got a boost from analysts at RBC Capital Markets, who said the outlook for luxury goods is improving after a torrid few years.

Premier Inn owner Whitbread fell 2.6 per cent, or 77p, to 2,911p after UBS cut the company’s price target to 4,200p from 4,400p.

IP Group rose 3.6 per cent, or 1.75p, to 49.95p after the investment firm agreed to sell stakes in nine of its companies to fund manager Lexham Partners for £15m.

Domino’s Pizza Group has revealed it faces a hit of around £3m a year from rising employers’ national insurance contributions and a further rise in the national minimum wage.

It came as the company revealed plans to grow to 1,600 stores generating £2bn in sales by 2028, and 2,000 stores generating £2.5bn in sales by 2033. It has more than 1,350 stores in the UK and Ireland. The shares lost 3.4 per cent, or 12p, to 340p.

Shares in glasses maker Inspecs plunged after warning that weak demand will hit profits.

The group expects profits of around £17.4m to £17.9m on sales of around £197m by 2024. Last year, it reported sales of £203.3m and profits of £18m. The shares fell 10.3 per cent, or 5p, to 43.5p.