The markets are having a respite from being battered by negative trade war news and top global indices are moving almost uniformly higher. European stocks started the day on a higher note taking their cue from a rally in Asia and in the US late Wednesday. For the time being the strengthening of the pound is not having any negative effect on FTSE trading, instead company news is grabbing the headlines.
Shares in Rio Tinto rise 1.64%
Rio Tinto, one of the largest global miners, plans to buy back a large portion of its Australia-listed shares before the end of the year. The dual listed Anglo-Australian company made a handsome profit from the sale of its Hail Creek and Valeria coal operations, and Winchester South and Kestrel mines earlier this year and wants to return about $3.2 billion from the proceeds to its shareholders. Rio Tinto will split the buyback into on-market buying of London-based shares and an off-market purchase programme in Australia with full details about the timing and volumes to be provided later in November. Rio Tinto is not the only miner to engage in share buy-backs this year. Raw material prices soared this year and companies like Glencore and BHP are also using their proceeds to buy their shares back.
Rio Tinto’s shares rose in Australian trading almost 3.7% but by the time London opened traded up 1.64%. Shares in other miners were also on the move higher with Antofagasta leading the gainers with a 2.27% rise and BHP Billiton trailing behind with a 0.93% increase.
Alibaba abandons idea of creating jobs in the US
The Sino-US trade war is not only claiming outright lost sales but also a significant amount of good will. Chinese e-commerce conglomerate Alibaba said the company can no longer meet its promise to create 1 million jobs in the US because of the trade dispute between the two countries. Although Alibaba itself never planned to employ any workers in the US the company’s chairman Jack Ma argued that the trading platform would bring 1 million small businesses onto its site and that each of the businesses would have to employ a new person to handle the additional sales. Alibaba’s US listed shares shrugged off the news to trade up 3.77%.
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