Jimmy Choo rallies on Kors deal
U.K. blue-chip stocks closed firmly higher Tuesday, as gains for miners and oil companies helped the market's benchmark chip away at a sharp loss logged in the previous session.
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The FTSE 100 index advanced 0.8% to end at 7,434.82, rallying after the gauge on Monday dropped 1% (http://www.marketwatch.com/story/airlines-oil-stocks-put-ftse-100-under-pressure-2017-07-24), hurt in part by declines for airlines.
"A healthy start from the commodity sector--itself aided by a $49 per barrel-eyeing rise from Brent crude and copper's continued climb--alongside a fairly muted open from the pound allowed the FTSE to surge back across 7,400," said Spreadex financial analyst Connor Campbell in a note.
But "with the back end of the week bringing one of the busiest corporate calendars of the year...the FTSE may want to enjoy the day's relatively uncomplicated trading while it lasts," he said.
Catching attention in London trade Tuesday was a $1.2 billion deal to buy luxury shoe maker Jimmy Choo (http://www.marketwatch.com/story/michael-kors-to-buy-shoemaker-jimmy-choo-in-12-billion-deal-2017-07-25-2915839)PLC (CHOO.LN) by fashion house Michael Kors Holdings Ltd. (KORS). Shares of Jimmy Choo jumped 17% to GBP2.28 off the FTSE 100.
Resources rev up: Mining shares were among top performers, with copper prices bouncing up more than 2%, aided by recent softness in the U.S. dollar and signs of stronger demand for the industrial metal from China (http://www.marketwatch.com/story/copper-prices-climb-on-chinese-economic-data-2017-07-25). The dollar will be in focus as the Federal Reserve begins its two-day policy meeting on Tuesday.
Copper producer Antofagasta PLC (ANTO.LN) was up 7.5%, and Fresnillo PLC (FRES.LN) gained 2.6%. Glencore PLC (GLEN.LN) claimed a 5.8% rise.
Meanwhile, Anglo American PLC shares (AAL.LN) leapt 6.1% after its Kumba Iron Ore unit said it would restart dividend payments (http://www.angloamericankumba.com//media/Files/A/Anglo-American-Kumba/investor-presentation/interim-results-2017-booklet.pdf).
Antofagasta and Fresnillo are slated to release second-quarter production updates on Wednesday.
Oil producers BP PLC (BP.LN) and Royal Dutch Shell PLC (RDSB.LN) bulked up by 1.5% and 1.4%, respectively, as oil prices pushed higher, including Brent crossing above $49 a barrel and flirting with the $50 level. Oil futures were up (http://www.marketwatch.com/story/oil-continues-to-gain-as-opec-raises-hopes-of-market-rebalancing-2017-07-25) after Saudi Arabia and Nigeria made fresh pledges to pull back on exports and output, raised expectations for greater market rebalancing.
Factories fire up: Production at British factories grew at the fastest pace since January 1995 in the three months to July, the Confederation of British Industry said Tuesday. The survey of 397 manufacturers also showed hiring expanded at its fastest rate in three years.
"It's great to see the benefits from the decline in sterling for U.K. exporters feeding through," said Rain Newton-Smith, CBI's chief economist, in a statement.
"But the flip side is the broader hit to consumer spending power across the economy from stronger inflation, which is likely to have fueled the slowdown in the economy in Q1 and is expected to pull down growth in Q2," he wrote.
The first reading of second-quarter gross domestic product is due Wednesday at 9:30 a.m. London time, or 4:30 a.m. Eastern Time, from the Office for National Statistics.
The economy is expected to have expanded by 0.3% on a quarter-over-quarter basis, and by 1.7% year over year, according to a FactSet survey of economists. GDP grew by modest 0.2% rate in the first quarter.
A report on services-sector activity in May also due Wednesday at 9:30 a.m. London time.
Ahead of that data, the pound bought $1.3041 compared with $1.3029 late Monday in New York.
Stock movers: Shares of Wm. Morrison Supermarkets PLC (MRW.LN) fell 2.2% after the company's market share fell (http://www.marketwatch.com/story/lidl-aldi-lead-in-uk-market-share-gains-2017-07-25) to 10.5% in the 12 weeks to July 16, according to Kantar.
Segro PLC (SGRO.LN) climbed 2.9% after the property investment and development company posted a rise in first-half pretax profit to 91.2 million pounds ($118.5 million). (http://www.marketwatch.com/story/segro-profit-rises-on-gain-in-portfolio-value-2017-07-25)
Mediclinic International PLC shares (MDC.LN) gained 1.2% after the health care group said Danie Meintjes plans to retire (http://www.marketwatch.com/story/mediclinic-ceo-danie-meintjes-to-retire-next-july-2017-07-25) from his position as chief executive and company director by July 2018.
But at the bottom of the FTSE 100 was Provident Financial PLC (PFG.LN), down 5.8% after the credit provider reported a 46% drop in first-half pretax profit (http://www.marketwatch.com/story/provident-financial-profit-drops-46-2017-07-25).
Earnings reports from drugmaker GlaxoSmithKline PLC and broadcaster ITV PLC, among others, are due Wednesday.
(END) Dow Jones Newswires
July 25, 2017 11:55 ET (15:55 GMT)