24th Aug 2018 16:58
LONDON (Alliance News) - Stocks in London ended higher on Friday with gains from heavyweight miners offsetting falls from housebuilders, while the head of the US Federal Reserve defended the bank's policy of gradually raising interest rates. The dominant theme over recent days has been over US-China trade talks which took place midweek - eventually ending without a breakthrough, as widely expected.There were lingering concerns among investors after the US imposed tariffs on USD16 billion worth of Chinese goods, leading to a tit-for-tat retaliation by the Asian nation.After the US imposed an additional 25% in duties on Chinese imports ranging from motorcycles to steam turbines and railway cars, China's Ministry of Commerce said it would lodge a complaint against the measure under the World Trade Organization's dispute settlement mechanism.Still, UK markets managed to shrugged off such concerns to end the week higher. The FTSE 100 index to close up 0.2%, or 14.27 points at 7,577.49 to end the week up 0.3%.The FTSE 250 ended up 0.1 %, or 25.94 points, at 20,691.41, ending the week up 1.2%, and the AIM All-Share closed flat, or down 0.33 points, at 1,092.22 ending the week up 1.3%.The Cboe UK 100 closed up 0.3% at 12,853.69, the Cboe UK 250 ended up 0.1% at 18,792.43, and the Cboe UK Small Companies closed up 0.1% at 12,338.59."The FTSE 100 still couldn't make the most of its wide-spread commodity rebound, the gains seen by the likes of BP, Shell, Anglo American and BHP Billiton countered by the losses suffered in the housebuilding sector following news that UK mortgage approvals tumbled in July," said Spreadex analyst Connor Campbell.On the London Stock Exchange, Antofagasta ended as the best blue chip performer, up 3.6% after RBC Capital upgraded the Chilean copper miner to Outperform from Sector Perform. The Canadian bank was confident over Antofagasta's second half prospects saying, "Antofagasta checks nearly all of the boxes that we look for in a mining company for long-term investment". In addition, miners ended among the blue chip risers amid a slight increase in metal prices. Glencore closed up 3.2%, Anglo American up 2.5%, BHP Billiton up 2.2% and Rio Tinto up 1.6%. "Platinum fell to a multi-year low this week, while copper and palladium reached levels not seen since last summer. There has been a small bounce back in metal prices today, and that has helped BHP Billiton, Anglo American and Rio Tinto," said David Madden, market analyst at CMC Markets.Conversely, housebuilders ended among the large cap decliners amid a decline in UK mortgage approval figures in July.Berkeley Group closed down 1.8%, Barratt Developments closed down 1.5%, Persimmon closed down 1.5%, Taylor Wimpey closed down 1.4%.The number of mortgages approved in July fell to 39,584 from 40,330 in June. Economists had forecast approvals to rise to 40,650, data from UK Finance showed. J Sainsbury closed down 1.2% amid worries over its tie-up with Walmart Inc-owned Asda Group Ltd, after the UK Competition & Market Authority's decision to investigate supply chain concerns in the proposed merger on Thursday.The decision to consider supply chains as part of its review of the deal, "may be a disappointment, if not a surprise, to the deal team", analysts at Shore Capital said. "We sense that doing so does heighten the risk of an undesirable outcome for them but by how much is hard to say."Stocks in New York were higher at the London equities close, as the head of the US Federal Reserve said he expects a slow but steady pace of interest rate hikes and there were few signs of the US economy overheating. The DJIA was up 0.5%, the S&P 500 index up 0.5% and the Nasdaq Composite up 0.8%.Addressing a gathering of bankers in Jackson Hole, Wyoming for the first time, Fed Chair Jerome Powell said that the economy was doing well and inflation was meeting expectations."My colleagues and I are carefully monitoring incoming data, and we are setting policy to do what monetary policy can do to support continued growth, a strong labour market, and inflation near 2%," Powell said."If the strong growth in income and jobs continues, further gradual increases in the target range for the federal funds rate will likely be appropriate," he added.Powell did not directly address criticisms by US President Donald Trump that hiking rates would hurt economic expansion. However, he did indicate the bank would work to prevent overheating.The central bank has been in a gradual but steady tightening cycle since the end of 2015.The pound was firm against the dollar quoted at USD1.2852 at the London equities close, compared to USD1.2830 at the close Thursday, as the dollar depreciated following Powell's relatively dovish comments. In Paris the CAC 40 ended up 0.2%, while the DAX 30 in Frankfurt ended up 0.2%. The euro was higher against the dollar at USD1.1624 at the European equities close, against USD1.1569 late Thursday, amid weakness in the greenback. In economic news from the continent Germany's economy expanded at a faster pace as initially estimated on domestic demand in the second quarter, detailed data from Destatis showed.The largest euro area economy grew 0.5% sequentially, following the 0.4% increase in the first quarter. The rate came in line with the estimate released on August 14.On a yearly basis, gross domestic product advanced at a faster pace of 2.3% after expanding 1.4% a quarter ago. Meanwhile, the calendar-adjusted GDP growth slowed slightly to 2% from 2.1%. Both annual rates matched expectations.Brent oil was higher quoted at USD76.16 a barrel at the London equities close from USD74.56 at the close Thursday.Gold was up quoted at USD1,207.80 an ounce at the London equities close against USD1,189.30 late Thursday.A light economic events calendar on Monday has Germany business climate data at 0900 BST.Financial markets in the UK are closed on Monday for the summer bank holiday.Related Shares:
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