MARKET REPORT: Miners rally as China promises to boost economy

Mining stocks led the London stock market higher yesterday as China signaled a period of interest rate cuts for the first time in 14 years.

Rio Tinto rose 3.8 per cent, or 189p, to 5113p, Anglo American rose 2.7 per cent, or 66.5p, to 2531p, Glencore gained 4.5 per cent, or 16.85p, to 394.85p and Antofagasta close 4.85p or 4.85p. higher than 1815.5p – all based on expectations Strong economic growth in China will increase demand for raw materials such as iron ore and copper.

The rally in the heavyweight mining sector helped the FTSE 100 up 0.5 percent, or 43.47 points, to 8352.08 even as investors worried about fresh tensions in the Middle East after the collapse of the Syrian president Bashar al-Assad.

The FTSE 250 was down 0.05 percent, or 9.73 points, at 21049.27.

As the regime shifts in Syria around the world, developments in China have led the markets.

As the world’s second-largest economy needs to expand, Beijing has said it will ‘implement fiscal and monetary policies’ from next year.

It is the first time China has signaled ‘loose’ monetary policy – or lower interest rates – since 2010 as it seeks to support recovery from the global financial crisis.

“We need to strengthen consumption, improve investment efficiency, and expand domestic demand,” the Xinhua news agency quoted the officials as saying.

Hopes of economic recovery in China – and uncertainty in the Middle East – boosted oil prices, with Brent crude up 1 percent to $72 a barrel.

Other London-listed stocks rose in China, with Prudential gaining 2.9 per cent, or 19.2p, to 681.4p, while Standard Chartered added 1.6 per cent, or 15.6p, to 989.2p. Burberry rose 4.3 per cent, or 40.2p, to 970p.

Burberry also got a boost from analysts at RBC Capital Markets who said the outlook for the luxury brand is improving after a particularly hot few years.

Premier Inn owner Whitbread fell 2.6 per cent, or 77p, to 2911p after UBS cut its price target on the company to 4200p from 4400p.

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

Domino’s Pizza Group has revealed it is being hit by £3million a year from rising employers’ National Insurance contributions and a rise in the national minimum wage.

It comes as the company reveals plans to grow to 1,600 stores delivering £2billion of sales by 2028, and 2,000 stores delivering £2.5billion of sales in 2033. There are more than 1,350 stores in the UK and Ireland. Shares lost 3.4 per cent, or 12p, to 340p.

Shares in glasses maker Inspecs fell after it warned weak demand would hit profits.

The group expects earnings of £17.4million to £17.9million on sales of £197million for 2024. Last year, it reported sales of £203.3million and profits of £18million. Shares fell 10.3 per cent, or 5p, to 43.5p.