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FTSE 100 hits over two-week high on commodity boost

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UK’s FTSE 100 index hit its highest level in more than two weeks on Tuesday, as commodity stocks led the gains after China’s decision to ease some COVID-19 curbs boosted sentiment globally.

The blue-chip index FTSE 100 climbed 0.9% to notch its highest close since June 10, while the mid-cap FTSE 250 index inched 0.2% higher.

China slashed the quarantine time for inbound travelers by half, in a major easing of one of the world’s strictest COVID-19 curbs. That sent global equities and commodity prices higher on the day.

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Oil majors added 2.5%, while industrial metals miners rose 1.5%, as metal and crude prices gained on hopes of a demand revival in the world’s second-biggest economy.

“Anything that relies on the Chinese consumer to really give it a big boost seems to be doing pretty well today,” said AJ Bell analyst Danni Hewson.

Scottish First Minister Nicola Sturgeon said the Scottish parliament would publish an independence referendum bill with a planned date for a vote on secession to take place on Oct. 19, 2023.

“Although Sturgeon has announced a date for the referendum to be held on, she now has to go through the courts to try and make it legally binding,” said Stuart Cole, head macroeconomist at Equiti Capital.

“The remaining UK would be better off financially without the burden of funding Scotland.”

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The FTSE 100 has outperformed its global peers this year due to a large presence of resource-focused companies, which have benefited from a surge in energy and commodity prices.

Oilfield services provider Petrofac Ltd gained 2.7% after saying its half-year trading was in line with expectations as an upswing in oil prices raised demand.

The UK insurer index edged 2.8% higher after finance minister Rishi Sunak said on Monday the state wants to reform insurer solvency rules quickly.

Utility Pennon fell 5.9% to the bottom of the mid-cap index after Britain’s water regulator opened an enforcement case against the company. (Reporting by Boleslaw Lasocki in Gdansk and Amal S in Bengaluru; Editing by Sherry Jacob-Phillips and Uttaresh.V)

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