LONDON MARKETS: FTSE 100 Closes Higher As Oil And Mining Stocks Rise
February 15 2018 - 12:47PM
Dow Jones News
By Carla Mozee and Victor Reklaitis, MarketWatch
Scottish Widows deal with Standard Life ending
U.K. blue-chip stocks on Thursday closed higher, with advances
for mining and oil shares helping the market to its second straight
rise.
The sector gains came as prices of oil and metals advanced,
partly due to a fall in the U.S. dollar Wednesday after mixed
economic data.
How markets are performing
The FTSE 100 added 0.3% to end at 7,234.81, boosted in part by
the basic materials and oil and gas groups. Together, those groups
make up nearly 25% of the benchmark's weighting, according to
FactSet data. On Wednesday, the London index rose 0.6% after a
volatile session
(http://www.marketwatch.com/story/ftse-100-climbs-as-investors-embrace-risk-before-us-inflation-data-2018-02-14).
The pound bought $1.4048, more than $1.4001 late Wednesday in
New York.
The yield on the 10-year gilt recently was up by 3 basis points
to 1.65%, according to Tradeweb.
What's moving markets
Weakness in the U.S. dollar has lifted most dollar-denominated
commodities, such as copper and oil . Crude oil prices were
building on Wednesday's rally, which was also bolstered by data
showing a disappointing rise
(http://www.marketwatch.com/story/oil-prices-add-to-gains-after-best-day-in-months-2018-02-15)
in weekly U.S. crude inventories.
Supported by those rises for metals and oil, shares of mining
and energy companies gained ground in London, helping drive the
index higher.
U.K. stocks were latching onto gains even after the U.K. pound
rose above $1.40, as the dollar stumbled. Strength in sterling can
eat into earnings made overseas by multinational companies on the
FTSE 100.
Stronger-than-expected U.S. inflation data
(http://www.marketwatch.com/story/cpi-surges-05-in-january-but-yearly-rate-of-inflation-unchanged-2018-02-14)
and rising Treasury yields initially lifted the greenback on
Wednesday, but that was accompanied by data showing an unexpected
drop in U.S. retail sales. Those mixed signals may have helped sink
the dollar, analysts said.
Check out:Here's why the U.S. dollar isn't getting much love
(http://www.marketwatch.com/story/heres-why-the-us-dollar-is-nobodys-valentine-2018-02-14)
What strategists are saying
"Given that these gains are coming after the hawkish, and
higher-than-forecast, inflation figures out of the U.K. and the
U.S., it appears that investors have become slightly more accepting
of any impending increase in interest rates. Or, at the very least,
they saw little in Tuesday's and Wednesday's data to speed up the
schedules laid out by the Federal Reserve and Bank of England in
the last few weeks," said Spreadex financial analyst Connor
Campbell in a note.
"It appears that the FX market has simply lost confidence in the
dollar. Widening interest rate differentials and expectation of
further U.S. tightening aren't supporting the currency like they
used to," said Marshall Gittler, chief strategist at ACLS Global,
in a note.
Stocks in focus
Standard Life Aberdeen PLC shares (SLA.LN) slumped 7.5% after it
said Lloyds Banking Group PLC (LLOY.LN) and Scottish Widows have
given notice to end the GBP109 billion
(http://www.marketwatch.com/story/standard-life-end-of-lloyds-scottish-widows-deal-2018-02-15)
($151.7 billion) investment-management arrangement that was reached
in 2014. Lloyds shares advanced 0.7%.
Shares of oil producers BP PLC (BP.LN) (BP.LN) climbed 0.4%,
though Royal Dutch Shell PLC (RDSB.LN) (RDSB.LN) dropped 0.3% as
earlier gains faded.
Among miners, Anglo American PLC (AAL.LN) gained 1.9%, BHP
Billiton PLC (BLT.LN) (BHP.AU) (BHP.AU) claimed a 1.5% rise, and
Antofagasta PLC (ANTO.LN) bulked up 1.8%.
(END) Dow Jones Newswires
February 15, 2018 12:32 ET (17:32 GMT)
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