FTSE 100 movers: Banks and miners rally; Micro Focus hit by CS note

London's FTSE 100 was down 0.4% to 7,359.69 in afternoon trade.

Banks racked up healthy gains, underpinned by news that all 34 banks in the second part of the US stress tests had passed. HSBC was the standout riser as it got an added boost from an upgrade to 'overweight' at Morgan Stanley, with Barclays, Standard Chartered and Lloyds also higher.

Neil Wilson, senior market analyst at ETX Capital, said: "The boost seems to have been the halo effect from the US, as all the major banks passed stress tests, which means they can now significantly raise shareholder returns. The Fed has effectively green-lighted up to $100bn in dividends and buybacks. US banks rose in after-hours trading as a result."

Miners also put in a solid performance as metals prices rallied on the back of a weaker dollar, with Anglo American, Rio, and Antofagasta all up.

Broadcaster Sky advanced amid news its £11.7bn takeover by 21st Century Fox will likely be referred to the Competition and Markets Authority for a full investigation. Culture Secretary Karen Bradley said on Thursday that she was minded to ask the CMA to launch a detailed assessment of the impact of the deal on media plurality after receiving a report by media regulator Ofcom. The competition watchdog will report its findings within six months.

But Olivetree Financal said there was remains "a not insignificant chance" that this can be remedied through undertakings in lieu. "On our numbers the deal is pricing a 60/40 chance of completion," it said.

Going the other way, Johnson Matthey was boosted by an upgrade to 'overweight' from 'equalweight' at Morgan Stanley, which bumped up the price target to 3,500p from 3,000p, but Micro Focus was on the back foot as Credit Suisse reiterated its 'underperform' rating on the stock.

Randgold Resources fell after an update on its Massaw gold project in Senegal, while Royal Mail, Babcock, Coca-Cola and British and Iberia parent IAG declined as their stock went ex-dividend.

Babcock's slump came despite it announcing a new contract from the Norwegian government to provide communities across Norway with “vital” air ambulance support.

Risers

HSBC Holdings (HSBA) 720.40p 4.95%
Sky (SKY) 997.00p 4.23%
Anglo American (AAL) 1,040.50p 2.82%
Barclays (BARC) 208.95p 2.70%
Rio Tinto (RIO) 3,239.50p 2.66%
Antofagasta (ANTO) 807.00p 2.41%
Glencore (GLEN) 290.60p 2.31%
Standard Chartered (STAN) 779.10p 2.04%
Johnson Matthey (JMAT) 2,972.00p 1.96%
Lloyds Banking Group (LLOY) 67.46p 1.29%