Market Report: China plan to build superhighway to Pakistan gives Footsie a fillip
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Your support makes all the difference.China provided a fillip to the Footsie yesterday, with news of the plan to build a £30bn superhighway to Pakistan; it also unveiled measures to stimulate its economy, boosting mining stocks on London’s FTSE 100, which closed up 57.5 points at 7,052.13.
The biggest risers included Anglo American, which climbed 27.5p to 1,038p, Rio Tinto, 73p ahead at 2,874p and BHP Billiton, up 35.5p to 1,481.5p, because China is the world’s biggest consumer of commodities.
Despite this, Chris Beauchamp, market analyst at IG, said: “The key is whether we can hold these gains. I’m not confident just yet that this is much more than a bounce after last week’s drop.”
Elsewhere, talk of a bid from a mystery US suitor had many investors queuing up to check into InterContinental Hotels Group.
The company, whose brands include Holiday Inn as well as the eponymous chain, was on the tips of traders’ tongues as rumours continued to circulate around the City that it could soon be bought.
InterContinental’s board is understood to have rebuffed a £6bn offer from an unnamed US bidder last year because it was too low. However, investors such as US hedge fund Marcato are keen for it to tie-up with a rival and Starwood Hotels has been named as one potential future partner. Shares in the company rose 64p to 2,786p, having spiked last week.
Construction firm Ashtead jumped 32p to 1,144p after Barclays raised its target price to 1,405p from 1,289p. “We believe the relative share price weakness year-to-date offers an attractive opportunity given the strong earnings growth we forecast over the next few years,” analysts at Barclays said.
Financial Times owner Pearson was also up, climbing 19p to 1,374p despite Liberum slapping a sell rating on the stock and an 800p target price. The broker said that changes to Chinese laws surrounding foreign ownership of assets could hit the company. And tool-hire specialist HSS Hire managed to show some signs of progress despite falling to a £8.5m loss last year on the back of refinancing costs. The company floated at 210p earlier this year, the bottom of its price range, but rose as high as 215p yesterday before closing at 209p.
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