London close: FTSE 100 driven higher by gains in mining, oil stocks

Blue-chip stocks in London hit a new record high on Monday, the same as in Germany and on Wall St, as big mining and oil giants improved with the prices of resources.

The heavyweight mining sector was riding high thanks to improvements in the prices of gold, silver and copper, while oil advanced on hopes of Opec extending its output pledge into 2018, thanks to comments by the energy ministers of Saudi Arabia and Russia.

"The best performers have been in the basic resource sector which has been enjoying a bit of a technical rebound after heavy declines in the past few weeks," said Michael Hewson, chief market analyst at CMC Markets UK.

"There is a case for speculating that part of the rebound is down to the announcement of the new $900bn Chinese Silk Road investment plan," said Hewson.

It was hoped this would deliver improved trade and infrastructure links to the rest of Asia, Europe and Africa, over the course of the next few years. However, he added it was unlikely to be enough to suggest a sustained rally for miners.

"Oil prices have also taken another leg higher after weekend comments from Russia and Saudi Arabia about the need to extend the output freeze into next year," said Hewson.

The FTSE 100 closed up 0.26% to 7,454.37 - and an intra-day high of 7,460.26 - even as the FTSE 250 slipped 0.06% to 19,751.01. Across the Atlantic Ocean, Wall St was advancing, while over the English Channel it was the Dax which notched up a fresh record high.

"Markets seem to be enjoying the signs that incumbent governments are set for victory in upcoming elections," said Jasper Lawler, senior market analyst at London Capital Group.

"A surge in energy company shares helped the UK's FTSE 100 join the German Dax index in making a fresh record high on Monday."

This was on the back of German Chancellor Angela Merkel's Christian Democrat party enjoying a surprise victory in German regional elections at the weekend.

"France was the big populist risk which has passed. French President Macron named Edouard Phillipe as Prime Minister, another graduate of the elite ENA school."

Returning to London, IG analyst Chris Beauchamp was a little wary about the new record high for the FTSE 100.

"What should worry FTSE bulls is that the index is exhibiting similar characteristics to the S&P 500 - namely that the rally is being powered by smaller and smaller numbers of rising stocks each day.

"This doesn't mean a correction is around the corner, but it does raise the prospect of a reckoning that could be ugly," he said.

"The last time we saw this was in October, when a spike to 7,120 was followed by a swift 6% fall. Latecomers to this rally should tread carefully, lest they find themselves holding the bag."

In the news, it was mining stocks such as Anglo American, Glencore, BHP Billiton and Antofagasta leading the FTSE 100 higher, with support from oil giants BP and Shell.

Also among the risers were some banks, other financials, airlines and a good number of property stocks.

Thomson travel owner TUI was on the back foot as it said losses grew in the first half but expressed confidence it can grow underlying earnings 10% this year.

Vodafone said it has agreed to transfer 35% of its indirect shareholding in Safaricom to Vodacom Group, its sub-Saharan African subsidiary, for 226.8m new Vodacom shares.

Market Movers

FTSE 100 (UKX) 7,454.37 0.26%
FTSE 250 (MCX) 19,751.01 -0.06%
techMARK (TASX) 3,591.14 -0.09%

FTSE 100 - Risers

Anglo American (AAL) 1,074.50p 3.22%
Glencore (GLEN) 294.00p 3.16%
Standard Chartered (STAN) 766.90p 2.86%
Barclays (BARC) 210.60p 2.28%
BHP Billiton (BLT) 1,190.50p 2.28%
Antofagasta (ANTO) 791.50p 2.26%
Rio Tinto (RIO) 3,024.00p 1.82%
Persimmon (PSN) 2,394.00p 1.44%
Mondi (MNDI) 2,043.00p 1.44%
Micro Focus International (MCRO) 2,500.00p 1.42%

FTSE 100 - Fallers

TUI AG Reg Shs (DI) (TUI) 1,133.00p -4.79%
Next (NXT) 4,264.00p -1.86%
Direct Line Insurance Group (DLG) 350.70p -1.65%
Imperial Brands (IMB) 3,662.50p -1.47%
Royal Mail (RMG) 424.90p -1.30%
Shire Plc (SHP) 4,689.50p -1.28%
Intu Properties (INTU) 275.60p -1.22%
Hikma Pharmaceuticals (HIK) 1,738.00p -1.19%
Admiral Group (ADM) 2,011.00p -1.18%
Rolls-Royce Holdings (RR.) 854.00p -1.10%

FTSE 250 - Risers

Sophos Group (SOPH) 366.00p 7.27%
Hochschild Mining (HOC) 264.80p 4.05%
Kaz Minerals (KAZ) 462.60p 4.03%
Ferrexpo (FXPO) 164.50p 3.72%
Weir Group (WEIR) 1,913.00p 3.46%
Tullow Oil (TLW) 201.10p 3.08%
Nostrum Oil & Gas (NOG) 489.70p 2.92%
Wizz Air Holdings (WIZZ) 1,943.00p 2.80%
Vedanta Resources (VED) 631.00p 2.60%
AO World (AO.) 149.70p 2.53%

FTSE 250 - Fallers

Vectura Group (VEC) 124.60p -4.81%
Allied Minds (ALM) 144.10p -4.57%
Thomas Cook Group (TCG) 92.40p -3.65%
Indivior (INDV) 323.20p -3.49%
Moneysupermarket.com Group (MONY) 338.30p -2.95%
Vesuvius (VSVS) 558.00p -2.28%
Berendsen (BRSN) 832.00p -2.23%
JRP Group (JRP) 128.80p -1.98%
Paysafe Group (PAYS) 471.10p -1.87%
Petra Diamonds Ltd.(DI) (PDL) 131.90p -1.86%