Xstrata (LON:XTA) led a revival today as the UK’s blue chips climbed back up after hitting three-week lows last week.
Investors cheered the news the mining giant has backed Glencore’s (LON:GLEN) revised bid of 3.05 shares for each Xstrata share.
The deal will now go to a vote and if 75% of Xstrata shareholders excluding Glencore pass it, the long-awaited £56 bln merger will finally become a reality.
Shares rose 2.4% to 981 pence, giving the FTSE 100 a much needed leg-up to stand at 5,800 pence, up 1 % or 57 points today.
Data from China once again had a hand in dictating the mood on the UK’s leading share index.
While things are improving on the manufacturing front there, the data was not strong enough to quash stimulus talks from the emerging superpower.
As for Spain, stress tests suggest the banks are in a better state than most people think.
However, Mike van Dulken from Accendo Markets worries that these results may be misleading.
“Spain’s bank stress tests produced a better result than expected (needs €60bn vs. Europe’s pledged €100bn),” said the analyst.
“However, having seen how the situation can play out elsewhere in Europe (think Greece, Ireland) is it really credible? Are assumptions for economic growth and bad debts from continued worsening of real-estate sector (root of Spain’s banks demise) tough enough?”
Miner Anglo American (LON:AAL) shifted 3.2% higher today, while Barclays (LON:BARC) rose 2.7% and Rolls Royce (LON:RR.) picked up 2.7%.
The biggest faller was Morrisons (LON:MRW), which dropped 0.9%, along with fellow supermarket chain Sainsbury’s (LON:SBRY), down 0.6%.