U.K. Stocks Rise as China Assures Market; Miners Gain
U.K. stocks rose, rebounding from the biggest four-day drop in 19 months, as China’s central bank allayed concern over a cash crunch and investors awaited data that may show U.S. durable-goods orders and house sales climbed.
Fresnillo Plc (FRES) and Antofagasta Plc (ANTO) each added at least 1.5 percent as a gauge of mining companies rose from its lowest level since July 2009. ARM Holdings Plc (ARM) gained the most in four weeks after Investec Plc advised investors to buy the shares. Rexam Plc (REX) fell for a fifth day as it said full-year results will be lower than it previously expected.
The benchmark FTSE 100 Index (UKX) gained 31.21 points, or 0.5 percent, to 6,060.31 at 8:57 a.m. in London, rebounding from a 5.4 percent loss in the past four days. The gauge is still heading for a 7.9 percent decline in June, the biggest monthly retreat since October 2008, after the Federal Reserve signaled it may end bond buying next year if the U.S. economy improves in line with forecasts. The FTSE All-Share Index added 0.5 percent, while Ireland’s ISEQ Index rose 0.9 percent today.
Liquidity risks in China’s financial markets are controllable and seasonal forces affecting interest rates will fade, a People’s Bank of China official said. The central bank will monitor the money-market rate and keep it at reasonable levels, according to Ling Tao, deputy director of the PBOC’s Shanghai branch.
The bank yesterday urged lenders to control risks from credit expansion, after money-market rates climbed to an all-time high last week. The Shanghai Composite Index closed 0.2 percent lower, paring an earlier slump of as much as 5.8 percent.
In the U.S., durable-goods orders probably grew 3 percent in May after rising a revised 3.5 percent the prior month, economists forecast before a Commerce Department report at 8:30 a.m. in Washington. Separate data may show sales of new houses increased to a 460,000 annualized pace in May, the highest since July 2008, from a 454,000 rate in April, according to the median estimate of economists.
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