Market Report: China's marginal manufacturing growth triggers speculation about tax cuts

China’s manufacturing purchasing managers’ index came in at 50.1 for April (AFP/Getty Images)

Hopes of fresh stimulus measures from Beijing lifted Britain’s mining stocks, after data showed that manufacturing in China, the world’s top metals consumer, grew only marginally last month.

China’s manufacturing purchasing managers’ index came in at 50.1 for April, just above the mark that indicates growth, and triggered speculation about tax cuts and other policies that could spur activity.

Only Lloyds, fresh from a well-received first-quarter update, stopped the miners taking the top three spots of the FTSE 100 leaderboard.

Anglo American was the sector’s highest climber, adding 60p to reach 1,165p, closely followed by Rio Tinto, up 112p at 2,997p, and BHP Billiton, which rose 46.5p to 1,607.5p.

But with most of Europe’s markets shut for the May Day holiday, there was little else to get traders’ blood pumping, until a rebound in US stocks provided some impetus later in the session and helped the FTSE 100 put on 25.32 points to finish the week at 6,985.95.

Among the beneficiaries of the turnaround were British American Tobacco and Imperial Tobacco, which added 47.5p and 37p to end at 3,640p and 3,229p respectively, and Tesco, up 4p to 225p.

Some utilities couldn’t find their way out of negative territory, though – something put down to pre-election jitters. Severn Trent closed down 41p at 2,084p and United Utilities was 13p lower at 958p.

On the FTSE 250, Rentokil Initial’s investors saluted a 6.2 per cent jump in the rat-catcher’s first-quarter revenues, brought about with the help of six new acquisitions in its pest- control division. It shares were 2.2p higher at 136.5p.

The newly floated Auto Trader couldn’t raise a smile with the appointment of former Next finance chief and new Sainsbury’s non-executive David Keens to its board, or a “buy” rating from Goldman Sachs. It fell 2p to 270p.

Among small-cap stocks, Sepura, a designer and manufacturer of digital radio products, shot up 13.56p to 144.5p after it unveiled a £93.3m acquisition of Spain’s Teltronic. Sepura, which will provide equipment for the Olympics in Rio de Janeiro, says the deal will help it take on rivals like Motorola.