London’s blue chip share index has closed at its highest level for more than a month as mining stocks surged on relief over China’s decision not to raise interest rates.
The FTSE 100 Index added 47.8 points to 5860.8, while markets worldwide also made gains due to cheer over China.
There had been fears Beijing would hike rates after Chinese inflation jumped to a 28-month high of 5.1%. However, investors were relieved that an annual economic meeting ended on Sunday with just a pledge to control inflation while shifting the economy towards more stable, balanced growth.
Wall Street’s Dow Jones Industrial Average rose more than 30 points soon after opening, while across Europe the Cac 40 in France lifted 0.9%.
But sterling suffered a difficult session, hit by a weak housing survey from property website Rightmove and after deputy Bank of England governor Charles Bean suggested more monetary easing was possible.
The pound fell to 1.19 euros and was down against most major currencies.
Among stocks, the top flight risers board was dominated by resources stocks as Kazakhmys climbed 63p to 1592p and silver miner Fresnillo cheered 61p to 1594p.
Household goods giant Reckitt Benckiser was also on the rise, up 2% or 64p to 3573p, as news of its deal to buy India’s Paras Pharmaceuticals was taken well.
Analysts praised the acquisition for expanding Reckitt’s market share in such a key emerging market.
The FTSE 250 Index was dominated by merger and acquisition activity in the oil and gas services sector.
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