A pick-up in Chinese growth and speculation over a delayed tapering of US stimulus gave UK markets a boost on Friday morning with the FTSE 100 nearing a one-month high.
The London index was trading near 6,600 in early trading today; it has not closed above this mark since September 19th when it ended at 6,625.39.
Chinese gross domestic product grew at a year-on-year rate of 7.8% in the third quarter, rebounding after the 7.5% growth seen in the second quarter. This was bang in line with consensus estimates, though a slowdown in growth of industrial production, retail sales and fixed asset investment in September could mean that there will be some weakness in upcoming quarters.
Meanwhile, as the dust begins to settle following the last-minute deal on Wednesday to extend the debt ceiling and reopen the US government, investors are now beginning to look at the impact it will have on the economic outlook. Many believe that the political uncertainty in Washington may be enough to delay the Federal Reserve from tapering stimulus until early 2014. Such hopes boosted the S&P 500
on Wall Street to its highest ever close of 1,733.15 on Thursday night.
Markets are looking ahead to the delayed release of the September US employment report next Tuesday, which will be "crucial in gauging the Fed's next possible move, if any move at all", said Market Strategist Ishaq Siddiqi from ETX Capital. "Many are now ruling out tapering during 2013 as the fiscal situation in the US will remain in the backdrop in some fashion until early next year when it has to be dealt with again," he said.
Anglo American falls after iron-ore slump
Diversified mining group Anglo American was lower this morning after reporting a 24% fall in iron-ore production in the third quarter and an 8% decline in manganese, which together account for one half of group profits.
Goldman Sachs was also weighing on the share price this morning after cutting its target for iron ore, saying it wants to see more clarity on the timescale of Fed tapering.
Fellow miner EVRAZ was also in the red after it reported a fall in overall production in the third quarter and said that steel prices continue to be affected by "downward trends" in global markets.
United Utilities advanced this morning after Credit Suisse upgraded its rating for the stock from 'underperform' to 'neutral', saying it only offers 2% total return downside to its target price. The target for Severn Trent, rated 'neutral', was increased from 1,530p to 1,580p.
FTSE 100 - Risers
Prudential (PRU) 1,253.00p +3.21%
Reckitt Benckiser Group (RB.) 4,450.00p +2.16%
Sports Direct International (SPD) 713.00p +1.64%
Whitbread (WTB) 3,314.00p +1.22%
Wolseley (WOS) 3,228.00p +1.13%
Kingfisher (KGF) 383.50p +1.08%
Diageo (DGE) 1,974.00p +1.02%
InterContinental Hotels Group (IHG) 1,848.00p +0.98%
GKN (GKN) 367.70p +0.96%
WPP (WPP) 1,288.00p +0.94%
FTSE 100 - Fallers
William Hill (WMH) 405.00p -2.83%
Anglo American (AAL) 1,512.50p -2.61%
CRH (CRH) 1,531.00p -0.52%
Mondi (MNDI) 1,091.00p -0.46%
Tullow Oil (TLW) 977.00p -0.46%
Barclays (BARC) 277.40p -0.32%
Royal Bank of Scotland Group (RBS) 375.70p -0.32%
British American Tobacco (BATS) 3,304.00p -0.30%
Old Mutual (OML) 196.60p -0.30%
Petrofac Ltd. (PFC) 1,384.00p -0.29%
FTSE 250 - Risers
Alent (ALNT) 348.70p +3.44%
Regus (RGU) 205.50p +2.65%
Renishaw (RSW) 1,620.00p +2.53%
Ted Baker (TED) 1,717.00p +2.32%
Telecity Group (TCY) 812.00p +1.95%
Ocado Group (OCDO) 458.40p +1.75%
Polymetal International (POLY) 579.00p +1.58%
Dunelm Group (DNLM) 878.00p +1.50%
BH Global Ltd. USD Shares (BHGU) 11.57 +1.49%
Rightmove (RMV) 2,587.00p +1.49%
FTSE 250 - Fallers
Savills (SVS) 635.50p -2.00%
Evraz (EVR) 129.50p -1.89%
Cairn Energy (CNE) 285.80p -1.24%
Interserve (IRV) 602.00p -1.23%
Mitchells & Butlers (MAB) 395.80p -1.05%
Keller Group (KLR) 1,040.00p -0.95%
Hansteen Holdings (HSTN) 104.00p -0.95%
Micro Focus International (MCRO) 791.00p -0.75%
UDG Healthcare Public Limited Company (UDG) 322.00p -0.74%
Serco Group (SRP) 519.00p -0.67%