London: FTSE 100 rises on mining, oil boost

[LONDON] London's FTSE 100 rose to a two-month high on Thursday (Oct 14), boosted by heavyweight oil and mining stocks, while retailer Tesco was the top drag as its shares traded ex-dividend.

The blue-chip FTSE 100 index climbed 0.9 per cent and recorded its best session in a week, with miners Antofagasta, Rio Tinto and Glencore among the top performers.

Oil majors BP and Royal Dutch Shell gained 0.8 per cent and 1.4 per cent, respectively tracking over 1 per cent jump in crude prices.

Industrial miners and oil stocks are the top performing sub-indexes so far this year, adding 28 per cent and 37 per cent, respectively.

The mining index has surged over 200 per cent since its March 2020 lows on recovering metal demand as economies reopened from pandemic-led lockdowns.

"On a broader basis, a slowdown in the global economic recovery could easily trigger a pullback in commodity prices in the near term, but for today it seems that investors are very much risk-on," said Russ Mould, investment director at AJ Bell.

The FTSE 100 has gained 11.6 per cent so far this year but the pace has slowed on bets that rising inflation pressures will lead central banks to pull back their accommodative monetary policies.

Bank of England policymaker Silvana Tenreyro said the central bank should not raise interest rates to tackle a surge in inflation caused by higher prices for energy and semi-conductors if it thinks these effects will be short-lived.

The domestically focussed mid-cap index advanced 1 per cent, with recruiter Hays among the top gainers. The stock rose 3 per cent after the company reported a jump in its quarterly net fees.

REUTERS