London-listed mining companies experienced a surge on Thursday, driven by record-high copper prices, positive Chinese economic data, and expectations of potential U.S. interest rate cuts. The sector, previously one of the Stoxx 600 index’s worst performers due to global growth concerns, saw a significant rebound. Anglo American shares jumped 5% at midday in London, while Rio Tinto, Glencore, and Antofagasta all climbed by approximately 4.5%. Rio Tinto is a leading international mining group. Glencore is one of the world’s largest global diversified natural resource companies.
The gains coincide with turbulence in the copper market, where prices have reached unprecedented levels. This follows the unexpected announcement of 50% U.S. tariffs on copper imports, set to take effect on August 1. According to Susannah Streeter, head of money and markets at Hargreaves Lansdown, while a broad price spike could benefit producers in the short term, U.S. domestic mining companies stand to gain the most, benefiting from higher realised revenues.
Analysts suggest that supportive Chinese economic data, particularly a rise in construction machinery sales, is bolstering the mining sector. Additionally, news that some U.S. Federal Reserve members anticipate potential interest rate cuts later this year is providing further optimism. A weaker U.S. dollar, making dollar-denominated commodities cheaper for other currencies, also contributes to the positive sentiment. Investment analyst Dan Coatsworth of AJ Bell noted wider market discussions of potential new government stimulus in China, which could further stimulate commodities demand.
Despite recent tariff announcements, stock markets appear to be in a risk-on mood, largely dismissing the tariff updates as insignificant. Investors are shifting their focus back to economic data and corporate news flow as key market drivers. Optimism is also high among European traders, with hopes for a framework trade deal between the EU and the White House before the week’s end.
