The FTSE 100 is rising around 1% on Wednesday, outperforming European peers after yesterday's sell-off, with gains led by banks and mining stocks as copper hits record highs. According to reports from Investing.com India, copper has been rallying to a fresh record high, extending gains into an eighth consecutive session, with aluminium, nickel and iron ore prices also moving higher. The metal has been supported by a recovery in Chinese demand and mounting concerns over global supply disruption, with around one-fifth of global mined copper production relying on sulphuric acid from Middle Eastern supplies. The combination of tightening supply, resilient Chinese demand, the energy transition and growing demand from data centre infrastructure is creating a powerful tailwind for the sector despite broader concerns over the economic fallout from the US-Iran conflict. Rio Tinto is rising around 4%, Anglo American up 4.3%, while Glencore and Antofagasta are both gaining roughly 3%. The larger driver for the FTSE is strength in mining stocks, with the metal, often viewed as a bellwether for the global economy, gaining momentum in recent weeks amid improving activity indicators in China.
Banking shares are recovering after recent pressure linked to speculation over a potential leadership challenge to Keir Starmer. As reported by Investing.com India, investors had become concerned that a weaker Starmer government — or a shift towards a more left-leaning leadership — could result in looser fiscal policy and increased borrowing, unsettling the UK gilt market earlier in the week. However, Starmer appears to be holding onto power, easing those concerns and helping stabilise UK government debt markets. That has provided support for the banking sector, with HSBC up around 1%, while Lloyds Banking Group, Barclays and NatWest Group are advancing between 1% and 2%. The banking sector's recovery reflects growing confidence in UK government stability and fiscal policy continuity.
The larger driver for the FTSE is strength in mining stocks, with Rio Tinto rising around 4%, Anglo American up 4.3%, while Glencore and Antofagasta are both gaining roughly 3%. According to Investing.com India, the metal, often viewed as a bellwether for the global economy, has gained momentum in recent weeks amid improving activity indicators in China. Supply concerns linked to the Middle East conflict are intensifying, with concerns over fuel availability in Peru, one of the world's key copper-producing regions, adding further pressure. The combination of tightening supply, resilient Chinese demand, the energy transition and growing demand from data centre infrastructure is creating a powerful tailwind for the sector despite broader concerns over the economic fallout from the US-Iran conflict.
The FTSE 100 rebounded from support near the 200-day SMA around 9,665 before running into resistance at 10,420, subsequently falling back below the 50-day SMA and testing rising trendline support near 10,175. As reported by Investing.com India, the rebound from trendline support is now driving a retest of the 50-day SMA near 10,340. A move above the 50-day SMA and the May high at 10,500 would create a higher high and strengthen the bullish outlook, opening the door towards 10,700, while failure to reclaim the 50-day SMA could leave the index vulnerable to another test of 10,175 support. A break below there would expose 10,000 and potentially the 200-day SMA near 9,890.
Gold prices are struggling to recover after yesterday's pullback following stronger-than-expected US inflation data, with markets now turning attention towards US PPI figures and the Trump–Xi summit in Beijing. According to Investing.com India, both headline and core US CPI came in above expectations, prompting markets to increase bets that the Federal Reserve may need to maintain a more hawkish stance. Traders are now pricing in more than a 40% probability of a Fed rate hike by year-end, with the inflation data pushing Treasury yields and the US dollar higher, weighing on non-yielding assets such as gold. The 30-year Treasury yield briefly touched 5%, while the two-year yield remained close to the key 4% threshold. The US dollar is also benefiting from renewed safe-haven demand amid rising tensions between Washington and Tehran, climbing to its highest level in a week and further pressuring bullion. Attention now shifts to US PPI data, which is expected to show wholesale inflation accelerated to 4.9% year-on-year in April from 4% previously. A stronger reading could reinforce concerns that consumer inflation will remain elevated in coming months, supporting a higher-for-longer Fed narrative.
