Top-flight London shares flew higher Friday after Asian bourses rose for a second day on hopes that soft economic data would delay interest rate hikes.
The FTSE 100 Index lifted 41.06 points to 6379 in early trading as Japan's Nikkei jumped 195 points and the Shanghai Composite gained 53 points.
A 0.2% fall in US consumer prices fuelled hopes that the US Federal Reserve will hold back from immediately hiking the cost of borrowing.
Mike van Dulken at Accendo Markets said: "This remains driven by weak/mixed macro data from China, US and Europe delaying expectations for a Fed rate hike and high hopes of additional global stimulus, which is considered positive for risk appetite."
Upmarket outfitter Burberry (LON:BRBY) was still out of fashion after telling the market Thursday that the Chinese economic downturn was taking its toll on its sales. Shares were 7p off at 1295p.
But non-conventional lender Provident Financial (LON:PFG) ticked up 90p to 3268p on news of a good third quarter.
UK Oil & Gas Investments (LON:UKOG) leaked 0.02p to 1.45p as it secured an extension to planning permission for its Markwells Wood well in West Sussex.
Falkland Oil & Gas (LON:FOGL) was also deep in negative territory on reporting delays in drilling its Humpback well in the South Atlantic. Shares backtracked 1.5p to 22.5p.
Gulfsands Petroleum (LON:GPX) was also 10% down as it said it had failed to secure a futher extension of the Fes petroleum agreement in Morocco.
MARKET PREVIEW
The wave of euphoria that started on Wall Street and spread across Asia’s stock markets overnight is expected to make its way to London with the FTSE 100 indicated to open sharply higher.
As perverse as it sounds, US equities were bolstered by softer than anticipated economic data.
The 0.2% fall in consumer prices adds to the weight of evidence suggesting the American economy may not be ready for an immediate hike to interest rates.
The latest jobs reading and spending numbers appear to make the case for kicking the decision on loan rates into 2016.
“Today’s US industrial and manufacturing production data for September are expected to reinforce the disappointing narrative with declines in both….which would be negative for the second month in succession,” said CMC Markets analyst Michael Hewson.
The Dow Jones added 217 points, or almost 1.3% to creep above the 17,000 level once again, while the broader based S&P 500 closed up 1.5%.
Over in Asia, the Japan’s Nikkei 225 index forged ahead 1%, the Hang Seng in Hong Kong nudged 0.6% higher and the Shanghai Composite rose 0.2%.
With the momentum definitely positive, Britain’s blue-chip index is expected to open its account with a 45 point rise to 6,383.67, according to IG.
In the market
A forward indicator, or just a simple blip? Well, analysts are split on the latest update from mining giant Rio Tinto, which reported a surprise 17% rise in iron ore shipments.
Crude
The Brent crude oil one -month futures contract is trading 2.81% or $1.37 higher at $50.08 per barrel.
Gold
The Gold futures contract is trading 0.7% or $8.30 lower at $1179.60 per ounce.The wave of euphoria that started on Wall Street and spread across Asia’s stock markets overnight is expected to make its way to London with the FTSE 100 indicated to open sharply higher.