LONDON, June 13 — UK’s main stock indexes edged up today, as a jump in miners ahead of a key US inflation data helped temporarily shrug off renewed fears of further rate hikes by the Bank of England.
The resource-heavy FTSE 100 rose 0.2 per cent as of 0814 GMT, while the domestically focused FTSE 250 midcap index was up 0.1 per cent.
Miners climbed 2.7 per cent, touching a seven-week high, as metal prices rose on hopes of improved demand after top consumer China cut borrowing costs to boost economic growth.
Investors were waiting for US May consumer inflation data, expected to show price pressures eased in that month, and likely corroborating bets for a pause in the Federal Reserve’s rate-hiking cycle. Traders expect a hike in July.
“However, if they see any inkling in the data that inflation risks running high again, they will throw a net to try and catch it with another rate rise,” said Susannah Streeter, head of money and markets at Hargreaves Lansdown.
The European Central Bank is widely expected to raise rates by 25 basis points on Thursday, while the Bank of England is also seen delivering a similar sized rate hike next week.
Back home, data showed Britain’s labour market looked much stronger than expected in the three months to April, bolstering bets of continued rate hikes by the BoE this year.
“We have this strong wage growth which of course will help households struggling with the cost of living crisis, but these latest labour market trends risk adding fuel to inflationary fires,” Streeter added.
Among individual movers, online trading platform CMC Markets dropped 5.4 per cent after flagging a hit to first-quarter net operating income, while housebuilder Bellway Plc dropped 2.4 per cent on flagging renewed slowdown concerns on higher mortgage rates and broader cost-of-living pressures. — Reuters
