5th Oct 2015 07:33
LONDON (Alliance News) - London shares opened higher Monday, with mining stocks pushing higher, while investors focus on purchasing manager's index readings for services due later this morning.
The FTSE 100 index was up 1.4% at 6,216.09 points, the FTSE 250 was up 1.1% 16,980.49 and the AIM All-Share was up 0.4% at 731.76. In Europe, the French CAC 40 rose 1.8% and the German DAX 30 was up 1.4%.
Glencore was the best blue-chip performer, up 10% at 104.17 pence, trading above 100p for the first time in almost two weeks. The stock touched an all-time low of 66.68p last week. The multi-commodities miner and trading house released a statement just before the London open Monday, noting the higher share price and increased volumes in its Hong Kong-listed shares and saying it knows of no reason for the movement.
"Having made such enquiry with respect to the company as is reasonable in the circumstances, the board confirms that it is not aware of any reasons for these price and volume movements," Glencore said in a short statement.
Glencore added it did not uncover any "information which must be announced to avoid a false market in the company's securities or of any inside information that needs to be disclosed" under Hong Kong laws. Just before the London open, shares in Glencore in Hong Kong were up 31%.
The FTSE 350 Mining Sector Index was up 3.2%, with all its constituents in the green. Anglo American was up 3.3%, Rio Tinto 2.5%, BHP Billiton 2.3% and Antofagasta 2.2%. Mid-cap KAZ Minerals was up 4.5%, while Vedanta Resources was 3.1% higher.
Societe Generale upgraded Rio Tinto to Buy from Hold and cut BHP Billiton to Hold from Buy.
Outside mining, Prudential was up 2.1%. The insurer is considering quitting the UK in order to escape more onerous regulation on the sector from the European Union, The Sunday Times reported.
The radical plan may result in Prudential selling its British operations or spinning them off into a separate company, the newspaper said, citing City sources. The departure would deal a major blow to London as a global financial centre and could put more pressure on UK Chancellor George Osborne, who is already working to sate the concerns of Britain's banks.
In the FTSE 250, Allied Minds was up 3.8% after it said its subsidiary Precision Biopsy has raised USD33.6 million to accelerate the commercial expansion of its ClariCore Biopsy product for prostate biopsy procedures.
Allied Minds contributed around GBP16.6 million to Precision Biopsy in the funding. As a result the value of Allied Minds' 68.3% holding in Precision Biopsy has increased to USD61.8 million from USD45.6 million, it said
Meanwhile, as the ruling Conservative Party conference has gotten underway, the UK government on Monday said it will launch a retail sale of shares in Lloyds Banking Group in the spring of next year, continuing its push to return the bank to public ownership.
HM Treasury said it is the intention of the government to fully exit its shareholding in Lloyds in the coming months, including a GBP2 billion sale of shares to retail investors. Shares in Lloyds were up 1.3%.
In the economic calendar on Monday, there are Markit services and composite purchasing managers' index readings from France at 0850 BST, with the same from Germany at 0855 BST, the eurozone at 0900 BST, and the US at 1445 BST. UK services PMI is at 0930 BST.
Elsewhere, there are eurozone retail sales at 1000 BST and the US ISM non-manufacturing PMI at 1500 BST, alongside the US labor market conditions index.
In Asia on Monday, the Japanese Nikkei 225 index closed up 1.6%. In China, the Hang Seng in Hong Kong trades up 1.4%. Shanghai remains closed this week to celebrate the Chinese National Day festival.
The World Bank downgraded its growth outlook for developing East Asia, citing China's economic rebalancing and the expected pace of normalization of the US interest rates. Developing East Asia will grow 6.5% this year, instead of 6.7% estimated in April, the bank said in its East Asia Pacific Economic Update released Monday.
The report assumed a gradual slowdown of the Chinese economy. The second largest economy is forecast to grow about 7% in 2015. The growth is expected to gradually moderate as the Chinese economy shift toward a model dominated by domestic consumption and services.
China is expected to grow 6.7% in 2016 and by 6.5% in 2017. In April, the lender had estimated 7.1% growth for 2015 and 7% for 2016.
On Friday in New York, the Dow 30 index closed up 1.2%, the S&P 500 up 1.4% and the Nasdaq Composite up 1.7%.
By Daniel Ruiz; [email protected]
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PrudentialAnglo AmericanLloydsKAZ.LRio TintoALM.LBHP Billiton PLCVedanta ResourcesGlencore