London Report: Mining shares lift FTSE despite doubt over ECB

BRITAIN’S top share index steadied near a two-month high yesterday, with some caution before the European Central Bank’s policy meeting tomorrow offsetting a rally in miners prompted by stronger metals prices.

The blue-chip FTSE 100 index ended 0.06 per cent higher at 6,829.17 points after rising up to 6,849.28 points, the highest level since early July.

Basic resources stocks were the biggest gainers, with the UK mining index up one per cent as zinc rose to a four-week high and aluminium neared an 18-month peak on in­creased fund buying.

Both BHP Billiton and Antofagasta rose 0.8 per cent (to 1,920p) and 1.3 per cent (to 791p) respectively, while Anglo American gained 2.5 per cent to 1,562p, with traders citing a Dow Jones report saying its CEO was “open to a takeover offer”.

But drugmaker Astrazeneca fell 0.8 per cent to 4,541p as it sought to play down speculation of a new bid. Its chief executive told Reuters that everything was “back to normal” in spite of reports that US rival Pfizer could make a new bid for the British company.

Most supermarket stocks advanced after falls on Monday. Tesco picked up 2.4 per cent to 230.90p, as new chief executive Dave Lewis told employees in a staff email the company would address its loss in market share “with urgency”.

Sainsbury gained 1.8 per cent (to 294.70p) and Wm Morrison Supermarkets edged up 0.35 per cent to 174.10p. Marks & Spencer, however, dropped one per cent to 436.50p.

Among other sharp movers, Vodafone rose one per cent to 208.90p, with traders citing a Nikkei report suggesting it might become a takeover target for Japanese telecoms firm SoftBank.

ECB President Mario Draghi’s dovish speech last month at a meeting of central bankers had raised expectations it was preparing more stimulus.

However, ECB sources said last week that any new action was unlikely, although not impossible.

Michael Hewson, chief market analyst at CMC Markets, said: “Investors remain reluctant to load up too aggressively ahead of this week’s ECB rate meeting and this appears to be limiting the upside potential, as investors weigh up the likelihood of further action at [tomorrow’s] meeting.”