View the article online at http://citywire.co.uk/money/article/a876103
FTSE wipes out losses as oil price bounces
FTSE 100 wipes the day's losses as oil price mounts recovery to jump above $31 mark.
Update: The FTSE 100 has wiped the day's losses as investors took heart from a rebound in oil prices.
The UK blue-chip index was trading 13 points higher at 5,890, having risen from a low of 5,774 in the morning's trading. It was supported by a rally in the oil price, which reached $31 a barrel, up from a low of $29.28 in the morning and 1.6% higher on the day.
Relief among oil traders spread to other areas of the commodities market, with iron ore and aluminium prices rising. That helped send miners racing to the top of the FTSE 100. Risers included:
- Anglo American (AAL) +7.4% at 243.5p;
- Glencore (GLEN) +5.2% at 85p;
- Rio Tinto (RIO) +2.9% at £16.56;
- Antofagasta (ANTO) +2.4% at 371.8p.
Shares in budget airliner Easyjet (EZJ) fell to the bottom of the index after a sustained sell-off during the day's trading on news that security fears had hit demand at the end of 2015.
FTSE falls as China fears bite
(10:11) The FTSE 100 has fallen into the red as oil fell below the $30 mark again and a renewed bout of stock market volatility in China sparked jitters.
The UK blue-chip index fell 89 points, or 1.5%, to 5,790, with oil stocks among the biggest fallers as the price of Brent crude continued to give away gains from last week's late rally.
Fresh falls in China's Shanghai Composite index, down 6.4%, also sparked further investor fears. 'Stocks in China have plunged to 13-month lows on capital outflow concerns from its transitioning economy and despite the People's Bank of China flooding the system with cash to keep borrowing costs in check ahead of the Lunar Holiday,' said Mike van Dulken at Accendo Markets.
Gains for precious metals miners Fresnillo (FRES), up 2.1% at 671.1p, and Randgold Resources (RRS), 1.9% higher at £46.85, were less surprising. 'Shares in miners of precious metals are topping the FTSE this morning as investors return to what the markets regard as safe ports in a storm,' said van Dulken.
'And further support for gold comes from a slightly weaker US dollar as markets price in expectations of a dovish Fed message tomorrow given the market turmoil since it delivered its landmark hike in December and likelihood it tones down its rhetoric on multiple rate rises this year.'
On the FTSE 250, where losses were less severe at 0.9% for the index, PZ Cussons (PZC) was the biggest faller, down 11% at 243.6p after the consumer products group posted flat first-half profits.
The Fidelity China Special Situations (FCSS ) investment trust was meanwhile hit by China's stock market fall, down 3.2% at 117.4p.
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- Randgold Resources Ltd (RRS.L)
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