Market Report: Evidence that China's economy is stabilising sent investors into mining stocks
Thursday 13 February 2014
After being out of fashion last year, yesterday looked like the moment mining stocks made a comeback. Fresh evidence that the Chinese economy is stabilising sent investors to dig into the sector and miners were top of the table.
David Madden, market analyst at spreadbetter IG, said: "A surprisingly high trade balance from China overnight Tuesday has put the mineral extractors in demand. A double-digit increase in imports suggests China is still hungry for metals."
Metal specialists Antofagasta lifted 24.5p to 927.5p and mid-table listed African Barrick Gold was 12p better at 252p.
The buoyant miners helped the wider market into positive territory: the sector added 6 points to the Footsie and the FTSE 100, up 2.37 points to 6,675.03, was in positive territory for the sixth consecutive day.
The distribution and outsourcing specialist Bunzl bounced up 27p to 1,418p after analysts at Bank of America Merrill Lynch advised investors to buy the shares.
The African-focused oil and gas specialist Tullow Oil's profits were hit by a decrease in disposal profits – operating profit was down 68 per cent – but this was better than analysts expected. The group will pay a final dividend and said it had details of a new discovery in Mauritania. However that wasn't enough to please investors and it lost 53p to 792.5p – bottom of the benchmark index.
The grocer Morrisons shot up in early trade on rumours that the founding family is preparing to take the firm private, but as the news was digested the supermarket group eased and ended the day up just 0.6p to 237.8p.
FTSE-250 listed Telecity's share price shortcircuited as the data centre network specialist didn't meet the City's targets. It reported 2013 pre-tax profit up 16 per cent to £88.4m, but worries about growing competition in the sector pushed its shares down 70p to 660p.
The Aim-listed cloud-based video subtitles specialist Zoo Digital said that revenue growth had been slower than expected. It fell 1.875p to 7.625p.
The US-based oil and gas producer Nostra Terra lifted 0.005p to 0.28p as investors anticipated a production update.
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