By Johann M Cherian and Shristi Achar A
(Reuters) -UK’s FTSE 100 closed higher on Monday, lifted by energy and miner stocks on steps taken by China to support its economy following a surge in COVID-19 infections in the Asian country.
The export-oriented FTSE 100 climbed 0.4%, while the domestically focussed FTSE 250 gained 0.3%.
Authorities in Beijing said on Friday they will focus on stabilising its $17-trillion economy in 2023 and step up policy adjustments to ensure key targets are hit.
Energy and mining stocks added 2.1% and 0.5%, respectively, tracking a rise in oil and copper prices. [O/R] [MET/L]
“Despite the best efforts of authorities to try and stimulate demand, infections are still surging, and it will be an ongoing concern about just how quickly the Chinese economy will be able to bounce back,” said Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown.
The FTSE 100 has remained resilient this year, down less than half a percent, as surging commodity prices and a weaker sterling supported the internationally focussed index.
However, the midcap FTSE 250 has slumped over 20% so far in 2022, set for its worst annual performance since 2008, hit by worries over soaring inflation and a potential recession.
The Bank of England raised interest rates by 50 basis points as expected last week, but investors were concerned by comments that rates could go higher going forward.
A majority of traders are now expecting the central bank to raise rates by 25 basis points on Feb. 2.
AstraZeneca fell 0.4% after the company said its drug Imfinzi failed the main goal of a late-stage study in patients with a form of late-stage lung cancer.
Capricorn Energy slipped after some of its investors opposed a planned merger with NewMed Energy, arguing that the deal undervalues the oil and gas producer.
(Reporting by Johann M Cherian and Shristi Achar A in Bengaluru; Editing by Savio D’Souza, Dhanya Ann Thoppil and Shounak Dasgupta)
