Gold miners have surged on the London stock market after the price of the precious metal today set another record.
Their gains came during a steady start to the week for the FTSE 100 index.
Wall Street markets are at record levels, having rallied last week on hopes of further US interest rates cuts before the year-end.
Market update: Record gold price and upgrade lifts Endeavour, airlines lower
10:10 , Graeme EvansGold’s latest record price today triggered a fresh wave of interest in the top performing FTSE 100 index stocks Endeavour Mining and Fresnillo.
West Africa-focused Endeavour jumped 5% or 136p to 2964p, with shares now double this year’s starting point after gold’s ascent to a peak of $3720 an ounce.
Endeavour also benefited from the support of analysts at Bank of America after they lifted their price target by 200p to 3300p.
The bank, which sees potential for the gold price to reach $4000 an ounce, added: “We like Endeavour's volume growth and capital return story as well as its unique geographic exposure to western Africa.”
The safe haven precious metal has risen by 10% over the past month as the outlook for US interest rate cuts boosts the appeal of holding the zero-yielding asset.
Geopolitical conditions, higher government debts and central bank buying have also contributed to gold’s 40% rise over the past year.
Silver and gold miner Fresnillo is up by more than 250% this year as the best performing stock in the FTSE 100 index. The Mexico-based firm rose another 112p to 2388p, while FTSE 250-listed Hochschild Mining jumped 10% to 30.2p to 344.4p.
Pan African Resources, which is AIM’s fifth largest company after more than doubling its market capitalisation to £1.7 billion this year, rose 3.9p to 89p.
A strong session for other commodity stocks including Rio Tinto and Glencore meant the FTSE 100 index held on to positive territory, up 6.13 points to 9222.80.
On the fallers board, airlines IAG and easyJet came under pressure following the cyber disruption at European airports over the weekend.
Their shares declined 3.8p to 379.7p and 5.1p to 448.1p respectively.
Other top flight strugglers included JD Sports Fashion, which weakened 1.3p to 87.1p ahead of the release of half-year results on Wednesday.
NatWest dropped 6p to 506.6p, despite Citigroup lifting its price target to 640p.
The first session for Burberry since returning to the FTSE 100 in this month’s quarterly reshuffle proved uneventful, with shares half a penny lower at 1131p.
BMW discloses £200m car finance provision
09:01 , Graeme EvansBMW’s UK car finance business has set aside more than £200 million to cover the potential impact of the continued fallout from the car loan mis-selling scandal.
It is the latest car firm to reveal the potential cost of the motor finance scandal, with millions of drivers expected to be eligible for compensation claims.
The Financial Conduct Authority is currently consulting on an industry-wide redress scheme for consumers who lost out when they took out a car loan between 2007 and 2020.
Gold miners higher in flat FTSE 100, airline stocks struggle
08:23 , Graeme EvansThe shares of FTSE 100-listed Endeavour Mining and Fresnillo have risen by another 4% after the price of gold today traded at a fresh record.
Other risers from the commodities sector include Shell after a 10p improvement to 2622.5p and Rio Tinto, which lifted 65p to 4664p.
The FTSE 100 index has fallen six points to 9210.67, with airlines IAG and easyJet under pressure following the cyber disruption at European airports over the weekend. Their shares declined by about 1.5%.
NatWest dipped 3.4p to 504.2p, despite Citigroup lifting its price target to 640p.
Gold price hits new record
07:57 , Graeme EvansThe price of gold today set another record high, lifting by 0.9% to trade at $3719 an ounce.
The precious metal has risen by 10% over the past month, aided by the prospect of further US interest cuts before the year-end.
Geopolitical uncertainty, higher government debts and central bank buying have also contributed to leave gold 40% higher over the past year.
Week ahead: Kingfisher and Saga due to report
07:32 , Graeme EvansB&Q owner Kingfisher and JD Sports Fashion are among the companies due to report this week. Their half-year figures are scheduled for tomorrow and Wednesday respectively.
industrial conglomerate Smiths Group and computing platform Raspberry Pi also post figures tomorrow, with the half-year results of over-50s travel and insurance business Saga due on Wednesday.
On the economy front, a flash reading from the S&P Purchasing Managers' Index will provide an early look at the performance of the UK economy in September.
Gold and Brent Crude higher, FTSE 100 seen lower
07:03 , Graeme EvansThe Dow Jones Industrial Average and S&P 500 index both set records on Friday after closing 0.3% and 0.5% higher respectively.
The latest Wall Street landmarks followed last week’s quarter point cut in US interest rates, as well as hopes of two further cuts before the year-end.
In contrast, the FTSE 100 index lost 0.7% last week and is seen opening 0.1% lower this morning. It closed on Friday down 11.44 points at 9216.67.
In Asia, the Nikkei 225 has recovered from Friday’s heavy decline with a rise of 1.1%.
However, the Shanghai Composite and Hang Seng index are in negative territory after China’s central bank held a key lending rate for a fourth successive meeting.
The price of gold remains near a record level after rising 0.3% to $3697 an ounce, while Brent Crude is 0.6% higher at $67.11 a barrel.
