FTSE 100 gains as miners steam ahead

The FTSE 100 ticked higher on Friday as strong miners buoyed the index and took it briefly to the highest levels since mid-October.

London’s leading index was 0.6% to the good in mid-afternoon trade on Friday.

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Miners soared as investors digested better-than-expected Chinese manufacturing data which raised hopes of improving activity in the world’s second-largest economy.

“Miners led the charge after Chinese manufacturing data beat expectations, raising hopes that the Asian superpower will require more commodities from the big natural resources companies on the stock market. The Caixin China General Manufacturing PMI index rose to 50.7 in November from 49.5 in October – a figure above 50 implies expansion and a figure below 50 is contraction,” said Russ Mould, investment director at AJ Bell.

On Friday, Anglo America, Glencore, Rio Tinto and Antofagasta were among the top risers. Anglo American stormed ahead with a 5% gain, and Antofagasta jumped 3.5%.

Housebuilders were in focus after Nationwide said UK house prices had increased for the third consecutive month amid a lack of supply.

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However, early gains for Taylor Wimpey, Barrat Developments and Berkeley Group Holdings had subsided by the afternoon as investors considered the dynamics behind rising prices.

“This looks like a welcome bump for the market, but it’s not quite as positive as it seems. A dearth of homes for sale has put a floor under prices, which rose slightly during November. But life remains tough for sellers,” said Sarah Coles, head of personal finance at Hargreaves Lansdown.

“Prices are on the up for the third successive month, which feels like good news. However, in order to get these higher prices, you have to actually sell your home – which is easier said than done. Sales have slowed to a crawl. October figures out this week from HMRC showed property sales were down a fifth in a year.”

Tesco was among the fallers after JP Morgan downgraded their price target to 230p from 240p. Tesco shares were down 1.8% to 280p at the time of writing.

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