Europe’s leading markets rose on Wednesday after a sharp rate hike by Canada’s central banks helped spur positive sentiment.
The FTSE 100 was among the markets to close higher as strength in commodity companies helped offset the impact of a strong pound.
London’s main index ended the day up 42.59 points, or 0.61%, at 7,056.07.
Michael Hewson, chief market analyst at CMC Markets UK, said: “It looked like it was going to be another mixed day for markets in Europe until the Bank of Canada raised rates by a smaller-than-expected 50 basis points at 3pm. 75%, suggesting that central banks are beginning to recognize the possibility that raising rates too aggressively could do more harm than good.
“It also left markets wondering if the Fed might follow suit next week after another poor set of housing numbers from the US.
“A jump in basic resources saw the FTSE 100 bounce back into the red as the US dollar fell and copper and crude oil prices rose, helping to lift mining heavyweights.”
It also led markets to question whether the Fed could follow suit next week after another poor set of housing numbers from the U.S.
On the continent, other major markets were also higher as the Bank of Canada’s decision ensured a rate hike in the second half of trading.
By the end of the session, Germany’s Dax was up 1.04% and France’s Cac was up 0.43%.
Across the Atlantic, sentiment was mixed, with the Nasdaq witnessing losses after Microsoft and Alphabet posted disappointing trading updates.
Meanwhile, the pound hit a fresh six-week high on Wednesday as confidence continued to return amid comforting expectations of a rate hike.
The pound was up 1.1% against the dollar at 1.159 and 0.18% against the euro at 1.152 at the close.
In the news of Dettol maker company Reckitt fell in value after it revealed a decline in sales over the last quarter.
The company said overall revenues were higher, but they were driven by changes in product pricing and the mix of products being purchased.
Actions Reckitt ended the day 244p lower at 5,722p.
The banking giant Barclays was down slightly at the close despite earnings beating forecasts.
The FTSE 100 firm told shareholders that profits rose to £2bn in the latest quarter amid a boom in fixed income, which rose 63% to £4.7bn for its international division as its clients increased trading during the latest period of market volatility .
It was down 0.4 pence at 149.82 in late trading.
Second financial firm Standard Chartered was one of the weakest performers of the day after its bad debt reserves rose amid continued investor caution about the Chinese market.
That meant shares fell 28.4p to 526o, despite a bigger-than-forecast rise in profits.
The price of oil moved higher because it also benefited from the belief that the rise in interest rates is slowing.
The price of Brent oil rose by 2.32% to 95.61 US dollars per barrel. London markets are closed.
The biggest gainers in the FTSE 100 were Antofagasta, up 81p to 1,227.5p, Fresnillo, up 30.8p to 745p, Anglo American, up 114p to 2,772.5p, Rightmove, up 19.4p to 508.8p, and Kingfisher, rose 8p to 221.2p. .
Biggest decliners on the day were Standard Chartered down 28.4p to 526p, Reckitt down 244p to 5,722p, Coca-Cola HBC down 49.5p to 1,904p, Whitbread down 48p to 2,574p and Haleon down 4.8p. on 268.3 b.
https://www.standard.co.uk/business/business-news/european-stock-markets-make-gains-after-bank-of-canada-rate-rise-b1035493.html
