As US Inflation Cools, Miners And Banks Lift The FTSE 100

(CTN News) – According to Bloomberg, the Inflation UK’s FTSE 100 rose Wednesday due to British banks passing the Bank of England’s stress test. Higher metal prices lifting mining stocks on signs that U.S. inflation has slowed.

There was a 1.8% gain for the blue-chip FTSE 100, and this was the best day it has had in over eight months. 2.4% was added to the FTSE 250 midcap index, which is more focused on domestic companies.

According to the Bureau of Labor Statistics, consumer prices in the United States rose modestly in June and registered their smallest annual increase in more than two years, indicating that inflation has continued to decline, raising hopes that the Federal Reserve and the Bank of England will follow a less hawkish monetary policy in future.

A drop in the yields on British government bonds has occurred for the first time in around a week as investors have trimmed their expectations for interest rate rises from the Bank of England following the release of inflation data.

According to James Baxter, founder of Tideway Wealth, the talk of inflation in the UK getting out of hand may have been a bit overdone in recent times.

“The strong pound will help the UK economy in a number of ways, such as the price of inputs falling and the price of energy falling in sterling terms. I think it is quite likely that we are going to get a shock on the downside in UK inflation at some point in the near future.”

As of now, money markets believe that there is a 58% chance that the Bank of England will increase rates by 50 basis points, down from around 80% a day earlier.

Despite a softer dollar, industrial metal miners led gains on the street, up 4.4% as the prices of most base metals rose on a softer dollar.

In a statement released by the Inflation Bank of England, the central bank said its annual stress test showed that each of the major lenders could cope with rising interest rates in a stressed environment, and none of them would need to submit revised capital plans as a result. As a result, UK banks rose by 2.8% in value.

In the wake of a strong demand and a slight ease in energy costs, J D Wetherspoon increased its profits by 10.3% after forecasting that its full-year profit would be in line with market expectations.

There was a 2.3% drop in the stock of International Consolidated Airlines Group SA it plummeted 2.3% after Deutsche Bank downgraded its rating on the British Airways owner’s stock from “buy” to “hold”.

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