London close: FTSE, sterling gain as Johnson calls it a day

London stocks ended firmly in the black on Thursday, while sterling gained after Prime Minister Boris Johnson finally threw in the towel.

The FTSE 100 rose 1.1% to 7,189.08, while the pound was 0.7% higher versus the dollar at 1.2008 and 0.9% firmer against the euro at 1.1814.

IG market analyst Chris Beauchamp said: "After a tough few days for commodity prices the buyers have come storming back, and the FTSE 100 has felt the benefits of this in a big way. Oil stocks and miners have once again provided the foundation for a bounce, putting the fight back into the index after a choppy few days.

"To be fair the global outlook for indices seems to be brighter in the wake of yesterday’s Fed minutes, if only because everyone seems to be glad to get the issue out of the way for a while. The recent fall in commodity prices might provide some temporary relief on inflation, and perhaps earnings season will surprise on the upside when it kicks off next week.”

"Sterling is revelling in what is probably its last ‘Boris bounce’, moving up against the dollar and the euro as the political crisis of the past few days subsides. The only question now is whether Labour has the strength to upset the Tory-run handover of power and force a snap election through a no confidence vote in Parliament. Even this isn’t much of a risk to the (not very bright) economic outlook, given Labour’s tame policy positions compared to 2019."

Market participants were also digesting the latest survey from Halifax, which showed that house prices rose in June at their fastest monthly pace since early 2007 despite the cost-of-living crisis.

Prices rose 1.8% from May, when they increased 1.2%. On the year, meanwhile, house prices were up 13% in June, versus a 10.7% jump the month before. The average house price pushed up to another record high of £294,845. The annual growth rate was the highest since late 2004.

Russell Galley, managing director at Halifax, said the UK market had continued to defy any expectations of a slowdown.

"The supply-demand imbalance continues to be the reason house prices are rising so sharply," he said. "Demand is still strong - though activity levels have slowed to be in line with pre-Covid averages - while the stock of available properties for sale remains extremely low."

In equity markets, miners were on the rise as metals prices rose, with Antofagasta, Anglo American, Glencore and Rio Tinto all higher.

RS Group advanced as it said full-year revenues and profit were set to be "slightly above" current consensus estimates following a strong first quarter.

Legal & General gained after saying it had had a good start to 2022, and that it expects to deliver double-digit growth in cash and capital generation for the first half.

Currys surged even as the electricals retailer said it expects annual profits to be lower as consumers started to tighten their belts amid the cost-of-living crisis. Keith Bowman, investment analyst at Interactive Investor said Currys had reported "broadly encouraging annual results following what has been a tough few years".

"Group sales on a currency adjusted basis are flat, although up 10% on a two-year like-for-like basis, while both pre-tax profit and the dividend payment are ahead of City estimates," he said.

Drax powered ahead after it said late on Wednesday that full-year adjusted EBITDA was set to be "slightly above" the top of the range of analyst expectations.

Hospital operator Mediclinic pushed up after saying it had received a fresh takeover proposal from a consortium led by billionaire Johann Rupert’s Remgro that it was minded to recommend.

On the downside, housebuilder Persimmon slumped even as it said it expects half-year profits to be "modestly" higher than expectations, despite rising energy and raw materials prices and wage increases.

Entain fell after saying that online gaming revenue would be flat in the current year, as customers started to cut back on spending amid soaring inflation and prices.

Market Movers

FTSE 100 (UKX) 7,189.08 1.14%
FTSE 250 (MCX) 18,875.53 1.51%
techMARK (TASX) 4,342.27 0.24%

FTSE 100 - Risers

Antofagasta (ANTO) 1,116.50p 7.36%
Anglo American (AAL) 2,816.00p 7.11%
Harbour Energy (HBR) 319.00p 6.87%
Glencore (GLEN) 433.25p 6.07%
BP (BP.) 385.25p 4.50%
Prudential (PRU) 1,025.50p 4.24%
RS Group (RS1) 894.00p 4.13%
Airtel Africa (AAF) 144.40p 4.03%
Rolls-Royce Holdings (RR.) 85.04p 3.82%
Legal & General Group (LGEN) 242.10p 3.82%

FTSE 100 - Fallers

Persimmon (PSN) 1,772.50p -4.96%
Flutter Entertainment (CDI) (FLTR) 8,090.00p -4.12%
Entain (ENT) 1,096.50p -3.82%
British American Tobacco (BATS) 3,379.50p -3.12%
Smith & Nephew (SN.) 1,132.50p -2.79%
Diageo (DGE) 3,518.50p -2.56%
Coca-Cola HBC AG (CDI) (CCH) 1,800.00p -2.04%
Reckitt Benckiser Group (RKT) 6,250.00p -1.76%
Fresnillo (FRES) 674.00p -1.69%
Unilever (ULVR) 3,825.50p -1.18%

FTSE 250 - Risers

Currys (CURY) 73.55p 10.52%
Aston Martin Lagonda Global Holdings (AML) 425.90p 8.21%
ASOS (ASC) 977.00p 8.09%
Mediclinic International (MDC) 476.20p 7.69%
Drax Group (DRX) 671.50p 7.53%
Wood Group (John) (WG.) 152.60p 7.19%
Euromoney Institutional Investor (ERM) 1,340.00p 6.01%
Tullow Oil (TLW) 42.00p 5.90%
Petrofac Ltd. (PFC) 109.50p 5.49%
BlackRock World Mining Trust (BRWM) 571.00p 5.35%

FTSE 250 - Fallers

Baltic Classifieds Group (BCG) 125.80p -8.84%
888 Holdings (DI) (888) 161.00p -3.88%
Convatec Group (CTEC) 221.00p -2.64%
Paragon Banking Group (PAG) 476.80p -2.05%
Discoverie Group (DSCV) 647.00p -1.97%
NCC Group (NCC) 191.60p -1.35%
Vietnam Enterprise Investments (DI) (VEIL) 641.00p -1.23%
The Global Smaller Companies Trust (GSCT) 140.80p -1.12%
Cranswick (CWK) 3,032.00p -1.04%
4Imprint Group (FOUR) 2,415.00p -1.02%