FTSE rises as China trade figures impress
Wed close: Shares in London pared back earlier gains, the FTSE 100 retreating from its 70-80 point surge that took it back through 6,000 to head towards the close nearer 25 points up.
London traders were buoyed by Asia turning positive overnight on a surprise upturn in Chinese trade data which showed exports fell 1.4% (in dollar terms) against expectations of an 8.0% decline. A 4.0% fall in imports was also much less than analysts expected.
The reliability of the data has come under lose scrutiny but does raise hopes of a stabilising of trade and the yuan. It also suggests the Chinese economy is not in such a state of deterioration as feared.
Jim Reid at Deutsche Bank said: “This morning has seen the latest trade numbers released with the data making for surprisingly better than expected reading. It was the first positive reading since June last year.”
Japan’s Nikkei rose 2.6% while Australian stocks gained 1.3%. The Shanghai Composite Index barely moved all day, while oil prices ticked up slightly.
Oil was in focus most of the day. US crude rose 40 cents to $30.84 a barrel, after falling below $30 for the first time in 12 years. Brent was 26 cents higher at $31.12 a barrel. It was the first rise in oil in eight days.
BP was up 4% after announcing 4,000 worldwide jobs would go, while Premier Oil is paying £83m for E.ON’s UK North Sea assets. Its shares were suspended pending an announcement. The assets it is buying are located in the Central North Sea, West of Shetlands and the Southern Gas Basin.
The deal will add about 15,000 barrels of oil equivalent per day to Premier’s production totals in 2016, said the company.