London's FTSE 100 climbed to a near one-month high on Thursday, led by financials, after Finance Minister John Healey reaffirmed the government's commitment to fiscal discipline. Stronger-than-expected GDP data also supported sentiment, while miners limited the gains.
The FTSE 100 rose 0.54% to 10,782.98 points by 09:50 GMT, its highest since September 18. The midcap FTSE 250, however, edged 0.07% lower.
Healey pledges fiscal discipline
Healey said this month's budget would aim at bolstering economic resilience, and that he and Prime Minister Andy Burnham were aligned on maintaining fiscal discipline. Following his comments, the UK's 10-year bond yield declined further to 5.34%.
Data added to the mood. UK GDP rose 0.1% in August, boosted by AI optimism, against expectations of a 0.1% drop.
Banks lead, miners drag
Heavily weighted banks advanced. NatWest Group rose 2.3%, and Standard Chartered gained more than 1%. Among consumer staples, British American Tobacco rose the most, up 2.6%.
Industrial metal miners, however, fell 3.1% on weaker copper prices over concerns of further US Federal Reserve rate hikes. Antofagasta dropped 5.8% after the Chilean miner's third-quarter copper production declined year-on-year. British Land, by contrast, rose 2.6% after saying it expects higher half-year profit.
Bank of England rate path in focus
Bank of England Chief Economist Huw Pill said that any future interest rate increase should not be read by investors as the start of a prolonged series of hikes. Economists polled by Reuters expect the BoE to raise rates to 4% in November, but narrowly expect it to hold from there.
Source: Reuters via Investing.com
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