(Reuters) -UK shares climbed on Wednesday, led by the gains in chemical companies and metal mining firms, while markets also found relief in U.S. President Donald Trump’s reversal of his threats to fire Federal Reserve Chair Jerome Powell.
As of 1045 GMT, the blue-chip FTSE 100 index was up 1.3% and the midcap index gained 1.2%.
Hopes for trade negotiations between the U.S. and China, which have been locked in an escalating tit-for-tat tariff war, also helped lift sentiment after Trump expressed optimism that a trade deal with the country could “substantially” lower tariffs on Chinese goods.
The chemicals index led the gains with Croda International jumping 10.7% after the company reported 8% growth in first quarter group sales. Croda also topped the FTSE 100 index.
BP climbed 5% after activist investor Elliott increased its stake in the oil major to just over 5%. An index of UK’s energy companies rose 3.6% after oil prices climbed more than 1% on a fresh round of U.S. sanctions on Iran and a drop in U.S. crude stocks.
Industrial metal miners were also up 4.5% in the day as copper prices in London hit a near three-week high.
Babcock rose 2% after the engineering firm said it expects fiscal 2025 operating profit to jump 17%.
On the data front, British businesses faced a sharp downturn in April as activity contracted to its lowest level since November 2022, the S&P Global’s Composite PMI showed on Wednesday.
The sharp drop in business activity is likely to further cement expectations that the Bank of England will cut interest rates next month.
Reckitt was among the worst performers on the blue-chip index as the maker of Dettol and Lysol cleaning products missed first-quarter like-for-like net sales growth estimates. Its shares dropped 5.9%.
On the midcap index, Hochschild Mining tumbled 16.9% and was set for the biggest loss in more than three years after the precious metal miner missed first quarter production esimates.
(Reporting by Ragini Mathur in Bengaluru; Editing by Shinjini Ganguli)
