FTSE on the rise

Relief that China refrained from raising interest rates pushed the FTSE 100 Index to its highest level for a month today as miners surged ahead.

The Footsie rose 43.3 points to 5856.3 thanks to gains from the heavily-weighted mining sector after Beijing held off from lifting rates to curb inflation.

There had been fears over a move by China after its inflation rate jumped to a 28-month high of 5.1%, but the country’s leaders wrapped up an annual economic meeting on Sunday with a pledge to control inflation while shifting the economy toward more stable, balanced growth.

Wall Street’s Dow Jones Industrial Average was also on course for a higher opening according to futures trading, boosted by gains in Asian and European markets.

In the UK, resources stocks were the major beneficiaries of London’s rally as Kazakhmys climbed 37p to 1566p and silver miner Fresnillo cheered 36p to 1569p.

Household goods giant Reckitt Benckiser was also on the rise, up 3% or 9.7p to 313.3p, as news of its deal to buy India’s Paras Pharmaceuticals was taken well.

Analysts praised the acquisition for expanding Reckitt’s market share in such a key emerging market.

The FTSE 250 Index was dominated by merger and acquisition activity in the oil and gas services sector.

Wellstream Holdings backed an £800m (€948.9m) takeover offer from America’s General Electric.

GE’s latest proposal, which followed two rejected offers, caused shares in Newcastle-based Wellstream to rise 38.5p to 785.5p, up 5%.

Elsewhere in the energy services industry, John Wood Group announced an agreement to buy fellow Aberdeen-based firm PSN for $955m (€719.3m) and added that the deal will be significantly earnings enhancing.

Shares in John Wood were near to the top of the FTSE 250 Index, up 7% or 33.8p to 522p.

Plant-hire company Ashtead followed them on the second tier risers board after a broker upgrade in the wake of last week’s forecast-beating half-year profits.

Its shares rose 5.8p to 161.1p, having soared last week on its results cheer.

But pub group JD Wetherspoon was seeing falls after a broker downgrade, which comes in the wake of a recent shares rally.

Wetherspoon shares dropped 19.4p to 435.6p, or 4%, followed by more declines for Comet parent Kesa Electricals after last week’s disappointing update for the UK business.

Kesa shares sunk 5.3p to 163.1p.