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FTSE 100 rebounds despite weak data from China | |
(about 4 hours later) | |
(Noon): UK shares rose, recovering some of the ground lost on Tuesday, despite further signs of weakness in China's manufacturing sector. | |
Shortly after midday the FTSE 100 was up 84.57 points at 6,020.41. | |
The index had fallen 2.8% in the previous session after commodity-related shares were hit by worries over the prospects for global growth. | |
However, investors shrugged off another survey suggesting China's manufacturing sector was continuing to contract. | |
A similar survey for the eurozone indicated that activity among businesses in the bloc continued to expand this month, although at a slower rate than in August. | |
The preliminary reading of the Markit purchasing managers' index (PMI) for the eurozone was 53.9 in September, down from 54.3 last month. A reading above 50 indicates expansion. | |
British Airways owner IAG topped the FTSE 100 risers board, climbing 4.7% to 563.50p after Morgan Stanley raised its price target for the stock. The news lifted shares in Easyjet, which climbed 2.8%. | |
Energy stocks were bolstered as the price of oil steadied. Shares in BP were up nearly 2%. | |
Shares in Smiths Group rose 2% after the company reported full-year results and said Andrew Reynolds Smith would take over as chief executive from Friday. | |
In the 12 months to 31 July, revenues at the engineering group dropped 2% to £2.89bn, but pre-tax profits rose 3% to £459m. | |
Drinks giant Diageo climbed 1.2%. The company said that recent currency fluctuations would cut operating profits by about £150m, but added that the financial year had begun well and "performance is in line with our expectations". | |
United Utilities shares rose 2% after the water firm's latest trading update. The company said its profits would be hit by about £25m after it had to pay compensation to about 300,000 households in Lancashire following the discovery of a parasitic bug in water supplies. | |
On the currency markets, the pound fell 0.4% against the dollar to $1.5308, and dropped 0.75% against the euro to €1.3703. |