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On Monday, the FTSE 100 in the UK experienced a modest decline -0.15%, with mining stocks leading the drop due to a fall in metal prices. Investors are anticipating a series of central bank meetings and economic data releases scheduled for this week. The industrial metal mining sector witnessed a decline of 1% due to the drop in prices of several base metals, mainly caused by the strengthening of the dollar. Additionally, iron ore prices also experienced a decrease. The decline in gold prices led to a 2.3% decrease in precious metal miners. The stock prices of both Endeavour Mining -4% and Glencore -3.9% languishing at the bottom of the FTSE, the mining companies, witnessed a decline following the release of data suggesting that China’s economy is experiencing a deeper contraction and entering a period of deflation. The economic indicators from China likely had a negative impact on commodity prices, affecting mining companies that are sensitive to fluctuations in global economic conditions.On the positive side of the ledger Rolls-Royce experienced a surge in its stock price after Citi raised its price target for the company’s shares from 294p to 431p, sending the companies shares to the top of the blue chip index with a gain of 2.5%. This was due to an increase in earnings per share forecasts by 27% in the short term and 52% in the long term, as well as strong cash generation. Citi expects that working capital unwind will aid cash flow in the near term, with sustained free cash flow of over 30p per share in the medium term, rising to 38p by 2028, which should be reflected in the company’s valuation.The focus now shifts to major central banks, including the Bank of England (BoE), U.S. Federal Reserve, and European Central Bank, as they are set to reveal their monetary policy decisions in the coming week.
FTSE Bias: Bullish Above Bearish below 7400
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