London midday: Stocks turn up as energy issues gain

London stocks had turned higher by midday on Monday, with energy issues providing a boost as the conflict in the Middle East lifted oil prices, and as investors mulled another uptick in UK house prices.

The FTSE 100 was up 0.4% at 8,314.86.

Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: "The threat of a further escalation is keeping upwards pressure on oil prices. On the first anniversary of Hamas attacks, which sparked the war in Gaza, there still appears no end in sight for the conflict, which still risks spreading further across the region.

"Brent Crude has gained ground again, trading above $78 dollars a barrel, following the largest weekly rise in over a year. Supply worries continue to swirl, even though OPEC+ nations have signalled they will go ahead with planned production increases. The perceived strength of the US economy is leading to expectations that there will be greater demand for energy across the US, helping offset continued weakness across sectors in China."

On home shores, figures released earlier by Halifax showed that house prices rose in September for the third month in a row and were close to record highs amid cheaper mortgage rates.

Prices rose 0.3% on the month, matching the increase seen in August. On the year, house prices were up 4.7% in September following a 4.3% jump the month before. This was still the strongest rate since November 2022.

The average price of a home stood at £293,399 - just shy of the record high of £293,507 set in June 2022 - versus £292,540 in August.

Amanda Bryden, head of Mortgages at Halifax, said it was essential to view the recent gains in context.

"While the typical property value has risen by around £13,000 over the past year, this increase is largely a recovery of the ground lost over the previous 12 months. Looking back two years, prices have increased by just +0.4% (£1,202)," she said.

"Market conditions have steadily improved over the summer and into early autumn. Mortgage affordability has been easing thanks to strong wage growth and falling interest rates. This has boosted confidence among potential buyers, with the number of mortgages agreed up over 40% in the last year and now at their highest level since July 2022.

"While improved mortgage affordability should continue to support buyer activity - boosted by anticipated further cuts to interest rates - housing costs remain a challenge for many. As a result we expect property price growth over the rest of this year and into next to remain modest."

In equity markets, Shell and BP were among the top gainers as oil prices continued to rise.

Separately, Shell was in focus as it posted a sharp drop in third-quarter refining profit margins.

Meanwhile, BP was in the stoplight after Reuters reported that the oil giant has abandoned a target to cut oil and gas output by 2030 as chief executive Murray Auchincloss scales back the firm's energy transition strategy to regain investor confidence.

Experian was in the black after an upgrade to ‘buy’ from ‘hold’ at Deutsche Bank, which lifted the price target to 4,750p from 3,500p.

Precious metals miners lost their shine as gold prices fell, with Fresnillo, Endeavour Mining and Hochschild all lower.

Rio Tinto was in focus as the miner confirmed speculation that it has approached Philadelphia-based lithium chemicals producer Arcadium Lithium regarding a possible takeover.

Mitie Group edged lower after saying it had bought Spanish security business Grupo Visegurity for up to €11m (£9.2m), comprising an initial payment of €9m and performance-linked deferred payments of up to €2m over the next two years.

Market Movers

FTSE 100 (UKX) 8,314.86 0.41%
FTSE 250 (MCX) 20,810.26 -0.43%
techMARK (TASX) 4,815.55 0.00%

FTSE 100 - Risers

NATWEST GROUP (NWG) 351.00p 2.48%
Shell (SHEL) 2,632.00p 2.11%
BP (BP.) 423.55p 1.61%
Standard Chartered (STAN) 841.00p 1.57%
GSK (GSK) 1,477.50p 1.23%
Diploma (DPLM) 4,258.00p 1.19%
Prudential (PRU) 717.40p 1.18%
BT Group (BT.A) 146.20p 1.18%
Barclays (BARC) 228.75p 1.10%
HSBC Holdings (HSBA) 698.50p 0.97%

FTSE 100 - Fallers

Hiscox Limited (DI) (HSX) 1,118.00p -1.76%
Fresnillo (FRES) 625.00p -1.73%
Centrica (CNA) 116.25p -1.65%
Melrose Industries (MRO) 452.70p -1.59%
Rentokil Initial (RTO) 358.50p -1.57%
Barratt Redrow (BTRW) 475.10p -1.45%
Persimmon (PSN) 1,636.00p -1.42%
Land Securities Group (LAND) 630.00p -1.41%
Vistry Group (VTY) 1,293.00p -1.37%
Haleon (HLN) 381.40p -1.35%

FTSE 250 - Risers

Fidelity China Special Situations (FCSS) 248.00p 3.12%
SSP Group (SSPG) 158.30p 2.79%
Energean (ENOG) 898.50p 2.22%
Foresight Solar Fund Limited (FSFL) 94.00p 1.95%
Ocado Group (OCDO) 396.40p 1.77%
Aston Martin Lagonda Global Holdings (AML) 111.50p 1.55%
IP Group (IPO) 49.45p 1.44%
Quilter (QLT) 136.60p 1.41%
Aberforth Smaller Companies Trust (ASL) 1,558.00p 1.30%
Close Brothers Group (CBG) 378.60p 1.28%

FTSE 250 - Fallers

Endeavour Mining (EDV) 1,647.00p -8.14%
Lancashire Holdings Limited (LRE) 643.00p -5.99%
Alpha Group International (ALPH) 2,120.00p -3.20%
Kainos Group (KNOS) 839.00p -2.78%
Babcock International Group (BAB) 469.60p -2.37%
CMC Markets (CMCX) 303.00p -2.26%
Helios Towers (HTWS) 109.40p -2.15%
Hilton Food Group (HFG) 893.00p -1.98%
TR Property Inv Trust (TRY) 351.00p -1.96%
AJ Bell (AJB) 441.50p -1.89%