London close: FTSE ends higher on rally in mining stocks

Anglo American, Rio Tinto and BHP Billiton were the biggest risers on London’s top tier index after gold prices climbed 0.40%, silver increased 0.55% and copper edged up 0.92% on the Comex.

Oil prices also gained as supply disruptions in Nigeria helped to soothe the global output glut. Analysts said a sharp fall in the dollar on Friday following worse-than-expected US non-farm payrolls report had also supported an increase in crude prices. A weaker dollar helps demand in the rest of the world as it makes oil imports traded in the currency cheaper.

The dollar, however, regained ground on Monday rising 0.05% against the euro, 0.42% versus the pound and 0.79% against the yen.

Housebuilders dominated the fallers on the FTSE after new Brexit polls showed more people want to leave the European Union ahead of Britain’s referendum on 23 June.

Persimmon, Barratt Developments and Taylor Wimpey slumped on concerns about a possible Brexit hurting the sector.

A YouGov poll found 45% in the UK wanted to leave the EU, while 41% were in favour of staying. An Observer/Opinium poll also found the Leave campaign ahead by 43% to 40%.

Sterling dropped 0.38% to $1.4463 at 1633 BST.

“While I would expect more downside if the polls continue to show the ‘Leave’ campaign gathering momentum, the pound is likely to be very volatile in both directions over the next couple of weeks,” said Craig Erlam, senior market analyst at Oanda.

“The polls are having a significant impact on the pound and some of them are sending very different messages. While support for ‘Leave’ is clearly growing, I still believe it will be a relatively comfortable win for ‘Remain’ on 23 June, albeit possibly not quite as comfortable as some will have hoped.”

Across the Atlantic, investors are awaiting a speech by Federal Reserve chair Janet Yellen at the World Affairs Council of Philadelphia’s luncheon at 1730 BST for clues on the next interest rate hike. Friday’s weak non-farm payrolls report has led some economists to believe a rate increase at the 14-15 June policy meeting is unlikely.

“Yellen has recently said she expects a rate hike to come in the ‘coming months’. One data point won’t derail the Fed’s expectation of gradually raising rates, but in the minds of the majority of the FOMC, likely pushes back the next rate rise to September,” said Jasper Lawler, market analyst at CMC Markets.

Speaking in Finland, Boston Fed President Eric Rosengren said earlier on Monday that a rate hike was still likely, albeit not this month, despite the weak jobs report.

He said it was important to wait and see whether the weak jobs report was a reflection of a broader slowing in labour markets or just an anomaly.

In company news, Coca-Cola fizzed higher after stating it expected average annual revenue growth rate in the range of 4% to 5% on a currency-neutral basis in the medium term versus 2.9% in 2015.

EasyJet dipped after saying its load factor fell 0.1 percentage points to 91.5% in May after cancellations due to French air traffic control strikes and weather conditions.

Wolseley declined as JPMorgan Cazenove downgraded the stock to 'neutral' from 'overweight' and cut the price target to 4100p from 4300p on valuation grounds.

Market Movers

FTSE 100 (UKX) 6,282.11 1.17%
FTSE 250 (MCX) 17,190.92 0.72%
techMARK (TASX) 3,142.81 0.51%

FTSE 100 - Risers

Anglo American (AAL) 686.60p 11.12%
Rio Tinto (RIO) 2,023.50p 6.78%
BHP Billiton (BLT) 889.20p 6.67%
Glencore (GLEN) 144.10p 6.23%
Antofagasta (ANTO) 451.10p 5.32%
Coca-Cola HBC AG (CDI) (CCH) 1,391.00p 4.43%
Johnson Matthey (JMAT) 3,063.00p 4.11%
Old Mutual (OML) 184.90p 3.76%
Mediclinic International (MDC) 916.50p 3.09%
BP (BP.) 368.40p 2.75%

FTSE 100 - Fallers

Royal Bank of Scotland Group (RBS) 232.40p -2.02%
Persimmon (PSN) 2,027.00p -1.46%
Wolseley (WOS) 3,698.00p -1.28%
Inmarsat (ISAT) 706.50p -1.19%
Barratt Developments (BDEV) 571.50p -1.12%
Tesco (TSCO) 160.25p -1.08%
easyJet (EZJ) 1,508.00p -1.05%
Taylor Wimpey (TW.) 188.50p -1.05%
St James's Place (STJ) 895.50p -0.94%
Whitbread (WTB) 4,145.00p -0.88%

FTSE 250 - Risers

Vedanta Resources (VED) 406.00p 8.27%
Weir Group (WEIR) 1,265.00p 7.20%
Polymetal International (POLY) 892.00p 5.06%
Softcat (SCT) 378.50p 4.99%
Murray International Trust (MYI) 973.50p 4.68%
Amec Foster Wheeler (AMFW) 443.50p 4.57%
Drax Group (DRX) 307.20p 4.03%
Kaz Minerals (KAZ) 153.70p 3.99%
Serco Group (SRP) 112.10p 3.99%
Euromoney Institutional Investor (ERM) 972.00p 3.85%

FTSE 250 - Fallers

Indivior (INDV) 210.00p -10.68%
Shawbrook Group (SHAW) 276.80p -3.89%
AO World (AO.) 169.40p -3.20%
Savills (SVS) 759.00p -2.69%
Redrow (RDW) 403.90p -2.67%
Greencore Group (GNC) 330.00p -2.65%
Virgin Money Holdings (UK) (VM.) 344.90p -2.63%
Sophos Group (SOPH) 187.40p -2.45%
NCC Group (NCC) 282.80p -2.42%
Crest Nicholson Holdings (CRST) 571.50p -2.14%