Stock markets are enjoying a decent move higher this morning, receiving a dual boost in sentiment from a proposed Chinese fiscal stimulus and a better than expected set of results from Google parent company Alphabet (NASDAQ:GOOGL) after last night’s closing bell.
The pound is edging slightly higher on the day but the gains have yet to gain any real traction, as traders continue to look for more signs that the currency can extend the small recovery seen in recent sessions.
Miners rally on Chinese news
The best performing stocks in London all come from the mining sector with strong moves higher seen in Anglo American (LON:AAL), BHP Billiton (LON:BLT) and Rio Tinto (LON:RIO) with these shares occupying the top 3 spots on the FTSE leaderboard.
A resurgent US dollar and concerns surrounding Chinese growth have contributed to a fairly strong fall in the price of several commodities in recent months, with metals hit particularly hard. However, an announcement that Beijing will implement a mix of tax cuts and infrastructure spending in an effort to stimulate demand and counteract as slowing economy has delivered some respite in the area, and while there remains doubts as to how sustainable this is longer term, it has certainly improved the mood for the here and now.
Fine fails to take the shine off Alphabet update
Shares in Google’s parent company Alphabet rose strongly by more than 4% in after hours trading last night, after the firm delivered an all-round pleasing trading update. Less than a week since the tech giant was hit with a record €4.3B fine over its Android mobile software the company posted strong results for the second quarter with both earnings and revenue topping analysts’ forecasts. Even though the fine has had a clear impact on profits, cutting 60% of the money earned in the 3 months to the end of June, it is still not really large enough to have lasting impact and deter investors with the stock called to open at its highest ever level in New York this afternoon.
Alphabet is one of the largest publicly listed companies in the world and the push higher had a clearly visible impact on the Nasdaq and S&P benchmarks due to the firm’s sizable weighting in each. The impact didn’t stop there though, as the positive sentiment has also contributed to gains elsewhere with stocks in Asia receiving a further boost from the Chinese stimulus announcement and together these have supported European bourses.