Anglo American, Rio Tinto and Antofagasta see share prices rise: Miners soar to the top of the FTSE
Brighter metal prices and a tumbling US dollar helped turn the fortunes of London-listed miners around today, as analysts speculated that the worst could be over for the embattled sector.
Mining stocks were reinvigorated as fading expectations of an interest rate rise by the US Federal Reserve sent the greenback tumbling. This helped gold hit a fresh three-month high and copper to its highest in a month, as dollar-priced commodities became cheaper for buyers using other currencies.
Anglo American briefly posted its biggest ever daily gain, with shares rising as much as 25.2 per cent to a session high of 342.7p, before easing back to close 20 per cent higher at 328.30p. Its previous biggest one-day gain was a 22.8 per cent rise in November 2008.
Extra momentum came from an announcement by South 32, the world’s largest producer of manganese ore. It’s axing at least 620 jobs at the company’s South Africa mine, which is 60 per cent owned by South 32 and 40 per cent by Anglo.
"Retail investors are rushing back into FTSE 100 miners, jumping on momentum from a weak US dollar inspired by hopes the Fed dials back on its hawkish trajectory for US rate rises,” Mike van Dulken, head of research at Accendo Markets, said in a note.
"It would appear that an increasing faction views the sector as having seen the worst, on its way back from oversold and on the right track in terms of painful measures to correct structural issues,” Dulken added.
Antofagasta closed up 14.56 per cent to 430.30p per share, Rio Tinto gained 10.27 per cent to 1,858p and Fresnillo finished up 8.59 per cent to 784p.
Glencore ended the day 15.97 per cent higher at 99.68p, despite Standard & Poor’s cutting its credit rating to one notch above junk.