Market report

Global miners Glencore and Rio Tinto boosted the FTSE 100 today as a Chinese manufacturing PMI survey beat expectations and indicated an increase in consumption in the metal-hungry sector.

The Caixin manufacturing PMI index rebounded to 50.4 in June with the UK’s largest miners heavily reliant on the Asian powerhouse’s manufacturing sector to sustain growth. Glencore rose 14.40p to 301.60p, a 5.0pc increase, and Rio closed 132.50p higher at £33.75, a 4.1pc gain.

“There’s a very close correlation between Chinese industrial production and UK miners and what goes on in China has a very big impact on UK mining stocks,” said ETF Securities head of research James Butterfill, who believes that China’s sector could continue to beat expectations over the summer.

He added: “Investors have been worried about mining stocks because they have cut capital expenditures by 50pc over the last four years and if you do cut that kind of capex it does leave you to wonder, particularly when commodity prices remain fairly depressed, where will be the next bump up in terms of earnings.

“China consumes around 50pc of the world’s iron ore and Rio Tinto in particular has large operations there.”

The strong performance from the base metal producers helped the FTSE 100 finish 64 points up to 7377. Precious metal miners Fresnillo and Randgold Resources, however, dipped as the price of gold plummeted to its lowest level in almost eight weeks.