UK's FTSE 100 rises on mining boost; Anglo American shines

Overnight, BoE Deputy Governor Dave Ramsden said the inflation data still showed risks of longer-term stickiness. The construction and materials sector added 1.2% as shares of Volution Group jumped 5.2% after the ventilation products supplier said it expects full-year profit to be ahead of current market expectations.

UK's FTSE 100 extended gains on Thursday as mining stocks rose on higher metal prices, while global miner Anglo American topped the index after reporting a jump in first-half copper production.

The blue-chip FTSE 100 gained 0.7%, hovering near a one-month high hit on Wednesday. The more domestically-focussed FTSE 250 midcap index gained 0.1% after a nearly 4% jump in the previous session.

Industrial metal miners gained 3.2% as prices of most base metals rose on short covering following a report that the Chinese government is looking at supportive measures for the real estate market. Anglo American added 5.1% after reporting a 42% surge in first-half copper production.

A weaker pound continued to support gains on the exporter-heavy FTSE 100 a day after data showed domestic inflation easing more than anticipated and traders sharply adjusting their terminal rate expectations for the Bank of England. "The potential economic benefits of interest rates peaking and hopefully not staying there for long is a massive plus for the economy," said Craig Erlam, senior market analyst at OANDA.

Traders are, however, betting on the BoE to hike its lending rate by a quarter percent when it meets next month. Overnight, BoE Deputy Governor Dave Ramsden said the inflation data still showed risks of longer-term stickiness.

The construction and materials sector added 1.2% as shares of Volution Group jumped 5.2% after the ventilation products supplier said it expects full-year profit to be ahead of current market expectations. IG Group rose 3.9% after the online trading platform raised its dividend and said it would buy back shares after it recorded total revenue of one billion pounds ($1.29 billion) for the first time in its history.

Dunelm Group advanced 2.7% after the home furnishings retailer said it expects full-year profit to be "slightly" higher than market expectations. Babcock International Group jumped 7.5% after the engineering company reinstated dividend for the financial year 2024.