LONDON: The UK's top share index recovered a little lost ground on Monday as gains among miners and commodity stocks buoyed the market, while Tesco led grocers after the supermarket completed its acquisition of Booker Group.
The FTSE 100 was up 0.5 percent at 7,103.30 points by 1008 GMT, in line with a broadly positive European market. However, the index remained close to its lowest level since December 2016, which it reached on Friday.
"The bounce for the FTSE is tepid at best," Mike van Dulken, head of research at Accendo Markets, said, adding that Brexit was still hanging over the market following a speech by Prime Minister Theresa May on Friday which failed to persuade many investors that a deal with the European Union was any closer.
The materials and energy sectors added the most points to the index, around 18 points collectively as oil prices advanced before a meeting between OPEC and US shale firms. Metals prices also firmed.
Shares in Royal Dutch Shell and BP both rose around 0.8 percent.
Miners Rio Tinto and BHP Billiton, which both have high exposure to iron ore, gained more than 1 percent and partially recovered some of the previous session's losses when steelmakers were hit by concerns around US President Donald Trump's plans to put tariffs on steel and aluminium imports.
While gains were broad-based, shares in grocer Tesco rose 0.6 percent after the company completed its $5.5 billion takeover of Booker, with Jefferies raising its rating on the stock to a "buy" rating.
Supermarket stocks have come under pressure from concerns around an inflation squeeze on consumers and a price war brought on by discount food retailers.
"The obvious benefits of reducing input headwinds and of a less defensively minded consumer should provide a more helpful backdrop to grocers from here," analysts at Jefferies said in a note. "Whether this will be supercharged by more modest discounter openings remains to be seen, but we are hopeful," Jefferies added, also upgrading Morrisons to "buy".
Outside of the blue chips, Ultra Electronics was the biggest mid cap faller, down more than 13 percent at a three-month low after the defence contractor terminated its $234 million acquisition of Sparton Corp due to anti-trust concerns raised by the US Department of Justice.
Comments
Comments are closed.