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Highlights
- Miners and Asia-focused stocks rise: The FTSE 100 held gains driven by a rally in mining and Asia-centric firms like Prudential (LSE:PRU).
- China's fiscal boost supports sentiment: Beijing's fiscal measures and central bank policies lifted commodity and luxury firms.
- Oil stocks weigh on gains: Shell (LSE:SHEL) and BP (LSE:BP.) fell over 4%, limiting FTSE 100's progress amid weaker oil price outlooks.
The FTSE 100 remained in positive territory during late trading, supported by strength in mining and Asia-focused stocks, although gains were capped due to a downturn in oil heavyweights like Shell PLC (LSE:SHEL, NYSE:SHEL) and BP PLC (LSE:BP.).
Leading the pack was Prudential PLC (LSE:PRU), climbing 6.1% after China reinforced its commitment to stimulating its slowing economy. Standard Chartered PLC (LSE:STAN) also saw a rise, tracking the broader gains in Asia-focused companies. This optimism was sparked by reports of a 2 trillion yuan (£213 billion) debt issuance, following pledges by Beijing to ensure necessary fiscal measures for meeting its economic growth target of 5%. Earlier in the week, China's central bank unveiled a series of initiatives aimed at reducing borrowing costs and easing lending restrictions, further bolstering sentiment.
The upbeat mood extended to mining giants, which rallied on prospects of stronger commodity demand. Antofagasta PLC (LSE:ANTO), Anglo American PLC (LSE:AAL), Glencore PLC (LSE:GLEN), and Rio Tinto PLC (ASX:RIO) all registered gains on the back of China’s commitment to bolstering growth. Similarly, luxury firms benefited from the news, with Burberry Group PLC (LSE:BRBY) jumping 7.7% and Watches of Switzerland Group PLC (LSE:WOSG) surging 8.7%.
IG analysts noted that concerns over a potential US recession have eased, while decisive action from Chinese authorities is countering fears of economic weakness in the region. Such developments are putting pressure on negative market sentiment.
However, London’s flagship index was kept in check by losses in oil majors Shell and BP, which dropped over 4% amid a bleak outlook for oil prices. This sector’s underperformance reflected broader uncertainties around energy demand and the supply dynamics that have weighed on oil stocks.
Despite the drag from the energy sector, the overall mood remained buoyant due to the strong performance from mining and luxury stocks, underpinned by hopes of a stabilizing Chinese economy.
