Mining shares are among the gainers as investors rediscover their appetite for risk assets.
In particular Anglo American has added 40p to 1585.5p after one of its main profit generators, Kumba Iron Ore in South Africa, reported better than expected results. A fall in iron ore export prices led to a 16% fall in earnings, with overseas sales volumes dipping slightly. But domestic sales volumes rose by 40%, helped by a new supply deal with ArcelorMittal in South Africa. Analysts at RBC Capital Markets said:
Kumba reported headline earnings of $606m; after accounting for consolidation adjustments, Kumba contributed $409m to Anglo's net earnings, coming in above our $339m forecast. Kumba comprises around 35% of our forecast first half earnings; we expect this result to have a positive impact on our earnings forecasts for Anglo.
Anglo reports first half 2014 results on Friday morning. Consensus forecast operating profit is $3.0bn with RBC at $2.8bn and earnings per share at $0.93 a share (RBC $0.89 a share).
Still in the mining sector, Fresnillo is up 20.5p at 936p and Antofagasta is 18p higher at 833.5p.
