FTSE rallies, U.S. data eases concerns over China

By Alistair Smout and Kit Rees

LONDON (Reuters) - The FTSE 100 rose on Thursday, recouping all of its losses from this week's bruising sell-off after strong U.S. data calmed global markets rocked by concerns over Chinese growth.

Britain's FTSE 100 (.FTSE) closed up 212.83 points, or 3.6 percent, at 6,192.03, shadowing gains made on Wall Street and in Chinese stocks. It was broadly in line with the pan-European FTSEurofirst 300 index (.FTEU3), up 3.7 percent.

The U.S. gross domestic product growth number easily beat expectations, but some said a September U.S. rate hike still looked unlikely due to market volatility.

Federal Reserve official William Dudley said on Wednesday that an interest rate hike next month seemed less appropriate given the threat posed to the U.S. economy by recent market upheavals.

Those have sent Britain's FTSE 100 down over 9 percent so far in August, setting it up for its biggest monthly loss since October 2008. It fell 1.7 percent in the previous session.

However, some investors said that if the concern over volatility in China delayed Fed rate rises, then the benefits for the global economy from continued easy monetary policy could outweigh the costs of market falls now.

"I believe the events of this week will prove to serve the global economy well in a wider context," Nigel Green, CEO of deVere Group, said in a note.

"Raising rates could have a host of dangerous consequences ... The Fed now (has) time to evaluate if an imminent interest rate rise is necessary."

All but one FTSE 100 stock was in positive territory, with China-sensitive stocks such as miners and UK-listed Asian banks among those adding the most points.

Anglo American (AAL.L) and mining companies Antofagasta (ANTO.L) and BHP Billiton (BLT.L) were the top risers, up more than 9 percent.

Shares of CRH (CRH.L) were up 5 percent after the Irish building materials company reported a rise in earnings and revenues.

It also bought U.S. glazing products manufacturer CR Laurence in a $1.3 billion deal which one broker described as sensible.

Miners rose almost 7 percent as copper rallied, buoyed by the stock market rally in China, the world's largest consumer of metals.

There were some underperformers. Miner Lonmin (LMI.L) was down 4 percent despite reporting that it expected full-year underlying cash costs to stay below its guidance after adopting measures to reduce production by the end of 2017.

(Reporting by Alistair Smout; Editing by Ruth Pitchford and John Stonestreet)