By Sruthi Shankar and Johann M Cherian (Reuters) -Britain’s top share index ended near a 10-week peak on Tuesday as strong results from BHP Group sparked a rally in mining stocks, while fashion chain Ted Baker soared on a buyout deal. The commodity-heavy FTSE 100 rose 0.4%. London-listed shares of BHP Group Ltd rose 5.5% […]
By Sruthi Shankar and Johann M Cherian
(Reuters) -Britain’s top share index ended near a 10-week peak on Tuesday as strong results from BHP Group sparked a rally in mining stocks, while fashion chain Ted Baker soared on a buyout deal.
The commodity-heavy FTSE 100 rose 0.4%.
London-listed shares of BHP Group Ltd rose 5.5% after the world’s largest miner reported its strongest profit since 2011 on the back of gains in prices of coal and other commodities.
The stellar results lifted peers such as Rio Tinto, Glencore and Antofagasta. The wider mining index gained 3.7%.
“While economic concerns have brought volatility in the commodity space, the recent Russia-Ukraine war has helped drive demand for alternate energy such as coal and gas,” Joshua Mahony, senior market analyst at online trading platform IG, said in a note.
“The forward-looking nature of markets should mean that investors look beyond any short-term weakening in favour of a 2024 recovery.”
Another bright spot was Ted Baker, which surged 16.9% after Juicy Couture and Forever 21 owner Authentic Brands agreed to buy the company in a deal worth roughly 211 million pounds ($254.26 million).
The FTSE 100 has climbed over 8% since hitting its lowest point of 2022 in March and remains less than 2% away from surpassing the year’s high.
However, the domestically focussed FTSE 250 index slipped 0.2% after Britain’s super-hot labour market displayed signs of cooling.
The number of people in work expanded by 160,000 in the April-June period from the quarter before, far below the rise of 256,000 expected by economists in a Reuters poll. Meanwhile, earnings adjusted for consumer prices index fell 4.1%, the biggest drop since records began in 2001.
“We think wage pressures will begin to cool as margins are squeezed into winter. But for now, we think there’s not much in these latest figures that will stop the Bank of England ( BoE ) from hiking rates by 50bp again in September,” ING analysts said in a note.
Consumer prices data is due on Wednesday, with investors looking for cues on the BoE ’s next move. Money markets are currently pricing in an around 83% chance of a second consecutive 50-basis-point hike from the BoE next month.
(Reporting by Sruthi Shankar, Johann M Cherian and Aniruddha Ghosh in Bengaluru; Editing by Vinay Dwivedi and Paul Simao)
