Leading shares have continued their post-election gains, helped too by positive global news.
China’s decision to cut interest rates for the third time in six months, by 25 basis points, following disappointing trade data has helped mining shares. Anglo American is up 23.5p at £11.39 while Glencore has climbed 6.75p to 309.35p. Michael Hewson, chief market analyst at CMC Markets UK, said:
Having seen a set of pretty awful March trade numbers, hopes were high that the April numbers would provide a bit of rebound. In the event they were disappointing as well, with exports sliding 16.2%, casting doubt on the global recovery story. Imports also slid again, this time by 6.4%, raising further questions about the internal Chinese recovery story.
This weakness appears to have prompted the Chinese authorities to cut rates .... with the likelihood of further easing measures in the coming months, unless things start to pick up quickly. This week’s April industrial production and retail sales data are likely to be the next key test as to the health of the Chinese economy.
Supermarkets are also in demand, both from the unlikelihood of a rise in the minimum wage now Labour has been defeated in the UK election and from talk of a possible merger between Dutch and Belgian groups Ahold and Delhaize.
Tesco, where there are reportedly a number of bidders for its Dunhumby data business, is up 5.5p at 234.35p and Morrisons is 4.7p better at 185.7p.
Still benefiting from the Tory election victory are housebuilders, with Taylor Wimpey up 4p at 179.7p and Persimmon putting on 33p to £17.79.
Meanwhile Sage is 20.5p better at 564p as Goldman Sachs raised its target price from 540p to 565p.
InterContinental Hotels has suffered some profit taking after last week’s first quarter results, down 39p at £27.81. Exane BNP Paribas lifted its target price by 11% to £35.50 but issued an underperform rating.
Overall the FTSE 100 is up 23.11 points at 7069.93, ahead of the lunchtime decision from the Bank of England on interest rates, delayed because of the election but expected to show no changes.
Investors will also be looking out for the Eurogroup meeting on Greece, to see if there are any signs of progress before Tuesday’s €780m payment due from the country to the International Monetary Fund.
Ahead of any news European markets are edging lower.
