Sector movers: Commodity stocks gain in 'risk-on' session

16th Sep 2015 16:44

(ShareCast News) - Risk on was the name of the game on Wednesday, as traders positioned themselves for the outcome of the US Federal Reserve's interest rate decision on the next day.That put a wind in the sails of commodity-related stocks, which as a group did best on the top flight index.Glencore led the charge higher, bouncing back after recent weakness after the company raised £1.6bn in gross proceeds from its share placing. In the final analysis, the company offered a smaller discount to that anticipated by the likes of JP Morgan Cazenove. It offered its shares at 125p versus the 120p assumed by those analysts.Nonetheless, on Wednesday the broker issued a note in which it warned that "any downward move in spot prices would see pressure re-emerge."Overnight, the Shanghai Stock Exchange's Composite Index registered a 4.89% advance to end the day at 3,152.26 points. Shares of Aberdeen Asset Management were also to be seen near the top of the leaderboard at the close.Were one inclined to look for the more fundamental reasons for the upside move in Shanghai-listed equities, then favourable comments on the country's economy out of Deutsche Bank might have made for one reasonable line of approach - albeit not without its detractors.On Tuesday, Deutsche Bank's chief China economist, Zhiwei Zhang, noted that fiscal expenditure grew at a 25.9% year-on-year clip in August. That marked a significant pick-up on the 11.8% expansion seen over the first half of 2015.Zhiwei believes the acceleration in public outlays confirms the shift towards stimulus on the part of Beijing that began towards the middle of 2015.He expects to see a recovery in growth in the fourth quarter.Perhaps. To keep in mind however, on 8 September ex-MPC member David Blanchflower 'tweeted': "I see degree of similarity in MPC minutes in sept 2008 when most argued US was irrelevant & sept15 minutes when most say China irrelevant."As an aside, and continuing with the 'risk-on' theme, three-month copper futures rose by 1.1% to hit $5,387.50 per metric tonne on the LME. Euro/dollar edged higher by 0.41% to 1.1310 and as of 18:04 BST December gold futures out on COMEX were changing hands at $1,122.9 per ounce, up by 1.86% on the day.The likes of Randgold Resources got a boost from the above.Yet perhaps the best example of the day's risk-on moves came from SAB Miller. The stock shot higher after announcing it had been told to expect a bid from rival InBev, possible well in excess of its $75bn market capitalisation.Front month Brent crude futures were firmer by 5.49% to $47.04 per barrel on the ICE.