Fears that the ongoing debt crisis in Europe could turn into a financial meltdown intensified today after Ireland became the latest euro zone member to see its debt rating cut to junk status by Moody’s.
However, the FTSE 100 was on the rise today, supported by better than expected Chinese economic data. The UK's blue chip index climbed 6.5 points (0.1 percent), reaching 5,875 by early afternoon.
Smaller than anticipated contraction in China’s economic growth sent mining stocks higher this morning. Today’s official data from the Chinese government showed that the country’s GDP rose 9.5 percent in the second quarter.
This was lower than the 9.7 percent growth rate seen in the first quarter of the year, but analysts expected a drop to nearer 9 percent.
In addition to that, it was reported that industrial production in China climbed from 13.3 percent in May to 15.1 percent in June.
Fresnillo (LON:FRES) led the way in the FTSE 100 this morning, advancing 5.6 percent to 1,521 pence.
Fellow mining majors Kazakhmys (LON:KAZ) and Eurasian Natural Resources (LON:ENRC) followed with Kazakhmys climbing 1,346 pence and ENRC rising 1.9 percent to 782 pence.
Another stocks that was in demand this morning was Burberry (LON:BRBY), which rose 2.4 percent to 1,472 pence by early afternoon.
The fashion group got a boost from strong quarterly results, which revealed a 34 percent jump in total revenues to £367 million in the June quarter.
Surprisingly, the retail sector seemed to be unshaken by today’s downbeat statement from sector major Marks & Spencer (LON:MKS), which said that the outlook for the full year remained cautious.
Shares in Marks slumped 3 percent to 362 pence on the update, making it the heaviest faller in the FTSE at midday.
US equities are expected to move in the same direction as European markets when today’s trading session kicks off on Wall Street.
Futures for the Dow Jones Industrial Average (DJIA) climbed 59 points (0.5 percent) in pre-market trade in New York, while futures for the broader S&P 500 index advanced 7 points (0.55 percent).
Shares in Monster Worldwide (NYSE:MWW) climbed 3 percent in pre-market. Netflix (NYSE:NFLX) and Amazon (NYSE:AMZN) advanced 1.6 percent.
Electronic Arts (NYSE:ERTS) was in decline in pre-market, falling 2.8 percent.
Asian markets were buoyant after today’s Chinese data.
Japan’s benchmark Nikkei 225 index rose 37 points (0.35 percent) to end the session at 9,963. China’s Shanghai Composite Index rallied 41 points (1.5 percent) to close at 2,795.