UK Stocks Rise Led by Miners

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UK Stocks Rise Led by Miners

UK top stocks edged higher on Monday buoyed by bullish Chinese manufacturing data and as property developers overcame worse-than-anticipated mortgage approval statistics.

The benchmark FTSE 100 index closed the day 0.3% or 19.59 points higher, at 6,864.10 points.

Mining shares across Europe jumped after statistics showed that Chinese manufacturing soared at its fastest rate in five months in May. Miner Rio Tinto and BHP Billiton, which are listed in London, advanced.

Mining shares are prone to the state of economy of China, the world’s biggest importer of metals. The shares plunged on Friday on speculations of a possible economic distress in the Asian country.

“Given that the (mining) sector has been pretty unloved recently, relating to ongoing concerns regarding Chinese growth, any bit of positive news on China will help,” strategist Robert Parkes of HSBC is quoted by Reuters as saying.

The FTSE 350 Mining Index, which plunged 16% in 2013, added 1.6%.

Home developer Barrat Developments surpassed peers, jumping 1.2% after its stock was upgraded by Gold Sachs to “buy” from “neutral.”

Other homebuilder stocks including Persimmon and Hammerson also gained despite reports that UK home-loan approval rate dropped more than anticipated in April to a nine-month low.

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UK factory activity remained on a growth path at fast rate in May, latest data showed, suggesting that the pace of economic recovery hasn’t been hurt much the current quarter.

“We’ve had a fairly robust PMI indicator out of the UK this morning. That will help domestically focused stocks,” added Perkes.

Beverage-bottling shares, Coca-Cola HBC added 3.4% after attracting investors following a 20% tumble in its share price so far this year. Rexam surged 2.1%, also commanding more investors after announcing a 450 million pound cash payback.

Drug-maker AstraZeneca shares jumped 2% after the firm posted impressive data for two of its brands.

According to MarketWatch, stocks of Anglo American Plc gained 2.3%.

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To contact the reporter of this story; Jonathan Millet at john@forexminute.com