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Europe: Britain's FTSE heads higher as miners recover

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[LONDON] The UK's top share index edged higher on Thursday, led by a strong rise in beaten-down mining stocks as news of fresh US-China trade talks lifted sentiment across markets and sectors.

The blue chip FTSE 100 closed up 0.8 per cent at 7,556.38 points while mid caps rose 0.7 per cent.

Anxiety over a currency crisis in Turkey has rattled markets over the past week, though positive developments in the US-China trade dispute calmed nerves on Thursday with broader European markets also ending the day in positive territory.

China's commerce ministry said a fresh round of trade talks will be held with the US in August, boosting base metals prices and in turn lifting shares in heavyweight UK miners.

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Market voices on:

"Investors will be very relieved there isn't a continuation of yesterday's market slump," Russ Mould, investment director at AJ Bell, said.

Shares in Antofagasta, Glencore, Fresnillo , Rio Tinto and BHP Billiton all rose between 0.9 and 2.5 per cent.

The Ftse 350 mining index bounced back 1.3 per cent, having dropped almost 5 per cent in the previous session to a four-month low.

Big, dollar-earning consumer staples stocks also gave a boost to the index as sterling traded close to 2018 lows, though the currency was modestly higher on the day. Shares in British American Tobacco, Imperial Brands and Unilever were all strongly in positive territory.

Oil majors and FTSE heavyweights BP and Royal Dutch Shell also added points to the index, rising 0.6 per cent and 1 per cent respectively.

Elsewhere it was a heavy day for stocks trading ex-dividend, with Evraz, Legal & General and Lloyds among the biggest fallers.

Shares in Kingfisher were down 4.8 per cent after Europe's second-largest home improvement retailer said sales rose thanks to prolonged warm weather, but a weak performance at French business Castorama clouded its outlook.

"The longer-term picture for Kingfisher is tough, with a slowing housing market and few (home) movers affecting sales at its stores," Ed Monk, associate director at Fidelity Personal Investing's share dealing service, said.

Results were also in focus among mid-cap stocks. Shares in online travel agent On The Beach jumped more than 15 per cent after a trading update, while a half-year earnings report helped Kaz Minerals shares gain 2.3 per cent.

REUTERS