A bullish assessment of US Fed boss Janet Yellen’s latest testimony sent London’s blue chips flying higher.
Footsie jumped 154 points to 6,117 with a rally in Germany by Volkswagen and other car groups also helping the mood across Europe.
The beleaguered German car maker announces its new chief executive today with Porsche boss Mathias Mueller seemingly certain to be unveiled as the new boss.
He is undoubtedly going to be busy as more countries today announced enquiries into diesel emissions stats for VW cars with Spain said to be recalling over 700,000 vehicles.
Johnson Matthey (LON:JMAT) was an early beneficiary as the platinum specialist rebounded 6% to 2,552p on hopes it might bring an end to VW’s troubles.
JM is a major supplier of the catalytic convertors used to control emissions from diesels.
Yellen meanwhile signalled US base rates would likely increase this year, but that further rises would be gradual.
Connor Campbell, at spread bet firm Spreadex, said: “This leaves the announcement of a rate-hike in October or December on the cards, providing the kind of future anchoring event for the markets they have been sorely lacking this week.”
Glencore’s (LON:GLEN) rollercoaster ride continued. Having led the risers early on shares in the one-time mining titan slumped again below 100p and traded 3% down at 95.5p.
Other miners also gave back early gains with Antofagasta (LON:ANTO) up just 3p to 529p, Anglo American added 0.5% to 628p.
Indeed alongside Glencore, only gold producers Randgold (LON:RRS) and Fresnillo (LON:FRES) were fallers at lunchtime.
Gold miners move to a different beat to their base metal cousins and US broker Jefferies reckons only African group Acacia is worth considering.
“With a gold price tail-wind unlikely to reappear, the is Acacia Mining (LON:ACA), which can still increase free cash flow and enhance its net cash position.”
Other gainers today included Marks & Spencer (LON:MKS), up 20p at 505p, and chip designer ARM ( LON:ARM) up 47p at 974p.
Lloyds rose 1.9% to 75.2p as the UK government sold more shares to reduce its stake to 12%.
Power station operator Drax (LON:DRX) was flat at 240p after it pulled out of a £1bn project to to cut emissions.
Away from the index, Synergy Healthcare (LON:SYR) was the biggest gainer as a court ruled against the Federal Trade Commission's (FTC) request for an injunction to block Steris’s acquisition of the company. Shares leapt 44% to 2,275p.
In the small cap space, Bagir Group (LON:BAGR) saw sales slip and losses widen as the company warned that things aren’t likely to get much better in the second half.
Shares dropped 27% to 4p today, having only listed in April last year at 56p.
Recent changes to UK government policy will cost it £7mln and have made it tough to fund new wind and solar projects according to Renewable Energy Generation (LON:WIND). Shares fell 12% to 40p.
African Potash (LON:AFPO) jumped 9% to 3.12p as it revealed it will be paid US$500 a tonne on the 50,000 tonne delivery to a Zambian distributor.
CCTV group SerVision (LON;SEV) dropped sharply to 3.54p after a placing raised £800,000 at a 24% discount to last night’s close.