FTSE 100 close: London markets storm to two week high
London’s premier index stormed to a two week high thanks as falling food inflation and hopes of a Chinese stimulus package lifted sentiment.
The bluechip FTSE 100 ended 1.7 per cent higher at 7,464.99 while the midcap FTSE 250 rose 1.9 per cent to 18,468.59. Many markets around the world saw strong trading yesterday, when trading was closed in the UK.
Investors were given a boost by data which showed that inflationary pressures in food continued to ease.
Food inflation fell to 11.6 per cent in August, down from 14.3 per cent in July, according to fresh figures from the British Retail Consortium (BRC).
“The punishing rate of price rises that shoppers have been enduring is easing off in the UK, which will provide some much needed relief after many months of double digit hikes in the cost of groceries,” Susannah Streeter, head of money and markets, Hargreaves Lansdown said.
On the FTSE commodity giants tracked metal prices higher after the Chinese government introduced some supportive measures for its stumbling economy, including slashing stamp duty on share trading.
AJ Bell investment director Russ Mould said: “Whether the medicine Beijing is doling out will deal with the causes rather than just the symptoms of its economic challenges is debatable, but for the time being it is at least doing enough to restore sentiment.”
Fresnillo ended up 3.9 per cent, Glencore 2.9 per cent and Anglo American 3.1 per cent.
Bunzl was among the FTSE 100’s top risers after raising its profit guidance for the year ahead and lifting its interim dividend by 5.2 per cent in its half year results. It climbed 3.1 per cent.
The outsourcing firm announced the acquisition of two more companies in Poland and the Netherlands, taking the number of acquisitions to 12 for the year.
“Acquisitions remain key to the Bunzl story, with £350m committed so far this year. Strong cash generation underpins self-funded growth and the 12 acquisitions announced so far this year highlight the intent,” Matt Britzman, equity analyst at Hargreaves Lansdown said.