FTSE Rises After Mining Shares Get China Boost

Mining shares have surged to the top of the FTSE 100 after China cut its interest rates.

The country, a key consumer of commodities, said its central bank – the People’s Bank of China – reduced its one year lending rate by 40 basis points and its deposit rate by 25 basis points. It has also unveiled reforms giving banks more freedom to set deposit rates. This is the first move in two years.

Metal prices have been under pressure on fears of a slowdown in China’s economy, with iron ore in particular hit hard. This had had a knock-on effect on mining shares, but this latest news has seen a revival in the sector.

So Anglo American has added 49.5p to £13.43, while Rio Tinto has risen 102p to £29.67. Glencore is up 11.2p to 334.65p while BHP Billiton is 53p better at 1635.5p.

 
Five of the top ten risers in the FTSE 100 are currently mining shares and this has helped the leading index climb 57.80 points to 6736.7.

via The Guardian

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza