LONDON: The U.K.’s benchmark stock index rose for an eight straight session on Friday, logging its best week in almost four years as Glencore PLC led mining-related stocks higher after announcing production cuts.
Risk appetite was also lifted as investors in Europe got the first chance to react to the minutes of the Federal Reserve’s latest meeting. The minutes helped cement the view among some economists that the Fed won’t be hiking rates at its last two meetings of this year.
The FTSE 100 UKX, +0.65% jumped 0.7% to close at 6,416.16, extending its weekly gain to 4.7%. That was the largest advance for one week since December 2011.
London stocks rose on Thursday after the Bank of England kept interest rates on hold and signaled policy will remain accommodative, provided the inflation outlook is murky.
“Ironically though, very little has changed fundamentally, particularly from a demand perspective and this does tend to argue against the sustainability of the current rally in the FTSE and indeed across all equity indices,” said Brenda Kelly, head analyst at London Capital Group, in a note.
Commodity stocks were the star performers for London on Friday. Shares of Glencore GLEN, +7.00% GLCNF, +8.20% 0805, +7.44% jumped 7% after the company— the world’s biggest miner of zinc—said it would cut global zinc production by a third. Glencore has announced a string of mine closures due to weak commodity prices. Zinc prices surged to a two month-high after the Glencore announcement.
Among other miners, Anglo American PLC AAL, +7.23% rose 7.2%, Antofagasta PLC ANTO, +3.11% climbed 3.1% and BHP Billiton PLC BLT, +4.32% BHP, +1.18% gained 4.3%.
U.S. crude prices CLX5, +0.12% pushed further past $50 a barrel, after tapping that level on Thursday, and related stocks responded to oil’s strength. BP PLC BP, +0.00% BP., +0.68% added 0.7%, BG Group PLC BG., +0.92% gained 0.9% and Tullow Oil PLC TLW, +4.03% climbed 4%
Outside commodities, Lloyds Banking Group PLC LLOY, +1.22% LYG, +0.63% shares ended up 1.2% after the U.K. government reduced its stake in the bank by another percentage point.
