UK stocks experienced a rise on Tuesday, mirroring global market gains. This upward movement came as markets responded positively to new stimulus measures introduced by China, boosting shares of both miners and retailers with a focus on luxury goods. By 0715 GMT, the blue-chip FTSE 100 index had increased by 0.5%, while the FTSE 250 midcap index, which is more focused on domestic activity, saw an advance of 0.3%.
The fresh measures introduced by Chinese regulators included a series of rate cuts and initiatives aimed at revitalising the country’s stock market. The goal was to stimulate growth within China’s struggling economy. As a result, equities around the world saw a rise, alleviating some concerns about the potential effects of a slowdown in the world’s second-largest economy.
London-listed industrial miners benefited significantly, surging by 5% to reach their highest level in almost a month. This rise in mining shares was driven by the expectation of increased metal demand, which pushed metal prices up. Among the prominent miners, Anglo American, Antofagasta, and Glencore saw their shares rise between 4.5% and 5.8%. Burberry, the luxury goods retailer, also saw a 3.7% increase, in line with other European luxury brands, on hopes that demand in the Chinese market would rebound.
In other developments, Bank of England Governor Andrew Bailey expressed optimism about the trajectory of inflation in an interview published on Tuesday. He stated that he was “very encouraged” by the downward trend in inflation, noting that interest rates were slowly heading lower.
However, not all companies shared in the market’s positive momentum. Smiths Group saw its shares drop by 6.3% after announcing the acquisition of two North American companies and reporting a slight miss in its annual profit. Dunelm also experienced a 6% decline after its top shareholder, Will Adderley, along with his private investment firm, sold nearly 5% of his stake in the homeware retailer.
Investors were also turning their attention to a speech by UK Prime Minister Keir Starmer at the Labour Party’s annual conference. This followed a statement from Finance Minister Rachel Reeves, who on Monday ruled out the return of economic austerity.
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