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Investment market update

Early Trading

UK stocks are expected to open higher this morning, boosted by stronger global equity markets following yesterday’s comments from Janet Yellen.

World Markets

US and Asian stocks outside Japan rose after Federal Reserve Chair Janet Yellen signalled the central bank remains wary of raising interest rates amid threats to American growth from a slowing global economy.

After a strong start to the day, UK stocks fell back to close little-changed, with mining stocks weighing on the market. Glencore Plc, Anglo American Plc and BHP Billiton Ltd. fell more than 3.5%, while EasyJet Plc rose 1.6% after Bank of America Corp. recommended buying the shares, citing an attractive valuation.

Headlines

Federal Reserve Chair Janet Yellen said it is appropriate for US central bankers to “proceed cautiously” in raising interest rates because the global economy presents heightened risks. The speech to the Economic Club of New York made a strong case for running the economy hot to push away from the zero boundary for the Federal Open Market Committee’s target rate.

Tata Steel Ltd., the metal-producing arm of India’s biggest conglomerate, will consider selling its UK steel division because of weaker demand and prices, marking a potential reversal of its $12 billion purchase made about a decade ago. Global oversupply, high manufacturing costs and rising steel exports mean trading conditions in the UK and Europe have “rapidly deteriorated,” and the factors are likely to continue, Mumbai-based Tata Steel said in a statement.

Japan’s industrial production dropped the most since the March 2011 earthquake as falling exports drained demand and a steel-mill explosion halted domestic car production at Toyota Motor Corp. Output slumped 6.2% in February after rising in January, the trade ministry said.

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