London close: FTSE higher on the day, helped along by miners

London stocks were holding onto gains by the close, underpinned by a strong showing in the mining sector and well-received earnings from HSBC.

The FTSE 100 was up 0.05% or 3.63 points to 7,372.00, while the pound was up 0.40% against the dollar at 1.3175 and 0.1% lower versus the euro at 1.1183.

In parallel, the second-tier index was ahead by 0.27% or 52.95 points at 19,781.14.

The gains came despite missile launches from North Korea and growing tensions between the US and Russia.

On Friday, North Korea tested a second intercontinental ballistic missile, claiming it proved that the whole of the US was within striking range. This came three weeks after its first ICBM test.

Meanwhile, at the weekend Russian President Vladimir Putin announced that roughly 750 staff must leave US diplomatic missions in retaliation for the approval of fresh sanctions against Moscow by Washington.

Heavily-weighted mining stocks put in a solid performance as iron ore rallied after a strong reading on Chinese construction offset a slightly disappointing manufacturing PMI overnight. The official manufacturing PMI for July fell to 51.4 from June's 51.7, just shy of expectations of 51.6. However, the PMI for the construction sector ticked up to 62.5 in July from 61.4 in June, marking its highest level since December 2013.

IG analyst Joshua Mahony said: "With a resurgence in Chinese demand for commodities, there is a reason to believe we will see the likes of copper and iron ore continue their recent ascent, in turn helping prop up the FTSE."

HSBC rallied as it unveiled a share buyback of up to $2bn this year alongside a better-than-expected 5% rise to $10.2bn in first-half profits.

AstraZeneca gained ground as the US Food and Drug administration agreed to speed up the process required for the development and regulatory review of its new cancer drug Imfinzi.

Indivior advanced as its new drug application for a treatment for opioid use disorder was accepted by the US FDA for priority review.

Senior rose despite posting a drop in pre-tax profit, as the engineer's first-half revenues and operating profit came in ahead of expectations, while financial software specialist Fidessa was on the front foot after reporting a 14% jump in first-half pre-tax profit.

Severn Trent and United Utilities were boosted by an upgrade to 'outperform' at RBC Capital Markets, while Royal Mail edged higher on the back of an HSBC upgrade to 'buy'.

IT-focused professional services company FDM Group surged after saying it experienced “strong” trading in the first half, with revenue up 35.4% to £117.1m, while fellow FTSE 250 newcomers Coats Group was in the red despite profits rising 14% and hiking its dividend.

Elsewhere on the downside, insurer Hiscox retreated after it reported a 12.5% jump in first-half pre-tax profit thanks to a solid performance in its retail business, but a drop including the impact of foreign exchange.

Tobacco stocks were under the cosh again after suffering heavy falls on Friday as US regulators said they planned to lower nicotine levels to non-addictive levels in an effort to reduce the number of tobacco-related deaths, with British American Tobacco and Imperial Brands both weaker.

Outsourcer Mitie was in the red as the Financial Reporting Council announced an investigation into Deloitte's audits of two of the company's annual financial statements.

Investors were also digesting the latest data from the Bank of England, which showed mortgage approvals hit a nine-month low in June, but consumer credit demand remained strong.

The number of mortgages being approved by UK banks and building societies is dropping but consumers are not reining in their demand for other forms of credit. UK mortgage approvals for house purchases in June fell to 64,684, a nine-month low, down from the revised total of 65,109 in May, below the consensus forecast of 65,000.

The BoE said approvals for remortgaging ticked up to 44,548 in June, similar to numbers seen earlier in the year.

Unsecured consumer credit increased rose by £1.5bn in June, which was down from the strong £1.8bn seen in the month before. Nonetheless, Monday's figures were in-line with consensus expectations and marked the 14th consecutive month of double-digit year-on-year growth in consumer credit.

Market Movers

FTSE 100 (UKX) 7,372.00 0.05%
FTSE 250 (MCX) 19,781.14 0.27%
techMARK (TASX) 3,463.85 0.23%

FTSE 100 - Risers

Severn Trent (SVT) 2,240.00p 4.09%
United Utilities Group (UU.) 897.50p 2.98%
Hargreaves Lansdown (HL.) 1,380.00p 2.83%
Standard Chartered (STAN) 846.70p 2.37%
Next (NXT) 3,950.00p 2.20%
Prudential (PRU) 1,848.00p 2.13%
AstraZeneca (AZN) 4,569.00p 1.95%
Taylor Wimpey (TW.) 190.40p 1.87%
HSBC Holdings (HSBA) 757.00p 1.80%
Anglo American (AAL) 1,252.50p 1.66%

FTSE 100 - Fallers

Imperial Brands (IMB) 3,120.00p -5.90%
British American Tobacco (BATS) 4,713.50p -4.97%
Rolls-Royce Holdings (RR.) 888.00p -4.41%
easyJet (EZJ) 1,236.00p -3.06%
Mediclinic International (MDC) 740.00p -2.63%
International Consolidated Airlines Group SA (CDI) (IAG) 578.00p -2.61%
Kingfisher (KGF) 294.40p -1.51%
Smurfit Kappa Group (SKG) 2,243.00p -1.45%
Centrica (CNA) 198.50p -1.44%
Pearson (PSON) 657.50p -1.42%

FTSE 250 - Risers

FDM Group (Holdings) (FDM) 893.00p 15.66%
Indivior (INDV) 384.00p 4.29%
Hochschild Mining (HOC) 316.40p 3.74%
TBC Bank Group (TBCG) 1,675.00p 3.72%
PayPoint (PAY) 892.50p 3.58%
IG Group Holdings (IGG) 636.50p 3.58%
Man Group (EMG) 160.00p 3.03%
Sports Direct International (SPD) 379.10p 3.02%
Fisher (James) & Sons (FSJ) 1,564.00p 2.82%
Grafton Group Units (GFTU) 768.50p 2.81%

FTSE 250 - Fallers

TalkTalk Telecom Group (TALK) 180.10p -4.41%
Hiscox Limited (DI) (HSX) 1,293.00p -4.07%
Aldermore Group (ALD) 217.20p -3.08%
Metro Bank (MTRO) 3,622.00p -2.87%
Virgin Money Holdings (UK) (VM.) 285.50p -2.53%
Just Eat (JE.) 620.50p -2.51%
Carillion (CLLN) 56.80p -2.41%
Tullow Oil (TLW) 168.10p -2.38%
Rightmove (RMV) 4,208.00p -2.25%
Mitie Group (MTO) 266.20p -1.84%