Stock

London Markets: Miners hit FTSE 100 as copper and iron costs fall, however London shares proceed to rally

London stocks rallied on Friday, rebounding from a sell-off in the US that spread to European markets this week, despite a number of large mining companies gaining profits.

The FTSE 100
UKX,
+ 0.75%,
The top London stocks index by market capitalization rose 0.7%, with most of its constituents increasing.

But shares in the mining giant Rio Tinto
RIO,
-2.17%,
BHP
BHP,
-1.42%,
and Antofagasta
ANTO,
-2.31%,
All the major producers of copper or iron ore stood out as fallers in London as the prices of these goods fell. Copper futures
HG00,
-1.13%
declined 1% while iron ore futures
TIOK21,
-1.47%
fell 1.5%.

Also read: The early Tesla supporter and top fund manager attacks Warren Buffett's strategy. Here is his investment advice.

A drop in commodity prices – including the Brent benchmark
BRN00,
+ 0.98%
Crude oil, which fell from just under $ 70 a barrel on Wednesday to below $ 67 on Thursday, and whose oil price is now closer to $ 68, came as stocks rose. Equities across Europe rebounded from earlier week declines, largely driven by US inflation fears.

Wall Street rallied strongly on Thursday, reversing a nearly 4% decline in the S&P 500
SPX,
+ 1.22%
Index over the week, with stocks catching up in London on Friday.

"It's been a tumultuous week as the scepter of inflation spooked investors again. However, it looks like last night's Wall Street rally would give the FTSE 100 a haven by storm as it saw a solid rebound on Friday morning." said Russ Mold, an analyst at AJ Bell.

Plus: Chip maker Alphawave plunges on debut in London after going public for $ 1.2 billion

The analyst highlighted the risk of the COVID-19 situation in India as the UK looks to continue opening up and easing travel restrictions after months of lockdown.

“Keeping the cases of the so-called Indian variant of COVID-19 under control is something the UK is facing and there is concern that the next phase of reopening could be delayed or put in place localized restrictions. This uncertainty could affect the hospitality and travel sectors, ”warned Mold.

However, the shares for travel and tourism remained stable on Friday with stakes in the airline IAG
IAG,
+ 1.92%
– which owns British Airways, Aer Lingus and Iberia – increases together with the low-cost airlines easyJet
EZJ,
+ 0.30%,
Ryanair
RYA,
+ 0.39%,
and Wizz Air
WIZZ,
+ 0.64%.
Hotel operator Whitbread
WTB,
+ 1.89%
and InterContinental Hotels Group
IHG,
+ 1.47%
also won.

Shares in the British corporate software group Sage
SGE,
+ 3.27%
rose 3.5% – the largest profit on the FTSE 100 – after the release of half-year results with earnings per share in excess of analysts' expectations. The group also assumed that their margins would increase beyond 2021.

Shares in Sanne
SNN,
+ 21.06%,
a UK asset management services group and part of the FTSE 250 midcap
MCX,
+ 0.78%
The index rose 21% after its board rejected a £ 1.35 billion (US $ 1.9 billion) takeover proposal from private equity group Cinven.

Related Articles