FTSE 100 close: Glencore and Rio Tinto power London index upwards despite downbeat IMF projections
London’s FTSE 100 kicked off a shortened trading week in robust fashion today, lifted by miners scaling higher despite the International Monetary Fund (IMF) warning the global economy is on course to suffer a sharp slowdown over the coming decade.
The capital’s premier index jumped 0.57 per cent to 7,785.73 points, while the domestically-focused mid-cap FTSE 250 index, which is more aligned with the health of the UK economy, climbed 0.85 per cent to 18,956.05 points.
Commodity giants lined the top of the FTSE 100’s summit, with Glencore, Rio Tinto, Anglo American and Antofagasta all up more than three per cent.
The gains came despite the Washington based lender of last resort, the IMF, projecting today in new forecasts that worldwide output is on track to trim to its weakest rate in 30 years.
A drop in economic activity would likely cool spending, weighing on demand for goods produced by London listed miners.
Analysts attributed the FTSE 100’s rise to a batch of stronger than expected UK economic data signalling households and businesses are in a much better shape than first feared just a few months ago.
“The FTSE 100 added to previous gains and now stands ahead by [around] 4.5 per cent in the year to date, with a mixture of a move to a risk-on approach and strong UK retail sales data adding to the immediate optimism,” Richard Hunter, head of markets at interactive investor, said.
Traders are gearing up for a pretty busy week of flagship economic announcements.
The IMF set out new projections for global GDP today, raising UK growth by the greatest margin of any G7 member, although also putting the country at the bottom of the rich nation growth league.
US inflation numbers out tomorrow are anticipated to show the rate of price increases slowed again in the world’s largest economy.
New GDP estimates for February for the UK released on Wednesday are expected to show the economy squeezed out 0.1 per cent growth.