Consumer discretionary, oil stocks pull FTSE 100 higher; Cineworld rises

By Shivani Kumaresan and Devik Jain

(Reuters) -London's FTSE 100 edged higher on Monday after posting its second straight weekly drop, while Cineworld Group gained following a strong weekend opening after a months-long lockdown in the UK.

The blue-chip index rose 0.5% with consumer discretionary stocks, mainly Compass Group Plc, Flutter Entertainment and Entain rising between 2.2% and 2.7%.

Oil majors Royal Dutch Shell and BP were also among the biggest risers on the index, rising 9.8% and 4.2%, respectively. [O/R]

The domestically focused mid-cap FTSE 250 index advanced 0.4%. Cineworld rose 3.2% after the world's second-largest cinema chain said its UK cinemas pulled in more people than expected, helped by Sony Pictures' animated adventure comedy "Peter Rabbit 2: The Runaway". [nL3N2NB1NG]

Globally, stocks struggled for momentum as investors awaited key U.S. inflation readings for guidance on monetary policy.[MKTS/GLOB]

"Observers will be asking if this is the week the FTSE 100 finally pushes ahead of the 7,000 mark after a period of going backwards and forwards around this level," said Russ Mould, investment director at AJ Bell.

Bank of England Governor Andrew Bailey said that he does not see long-term implications from a pick-up in inflation which the BoE expects this year as the economy emerges from the coronavirus pandemic.

After rising 9.1% in the first four months of this year on recovery optimism, the FTSE 100 has traded in a tight range in the past few sessions as concerns grew that central banks might pare back their support early as economies reopen and inflation picks up.

Kainos Group fell 1.8%, even after the digital services company posted a 124% jump in its annual adjusted pretax profit. [nASN00189S]

Chilean miner Antofagasta fell 0.9% after RBC cut its price target on the stock, while Mr Kipling owner Premier Foods climbed 5.9% after brokerages raised their price targets.

(Reporting by Shivani Kumaresan and Devik Jain in Bengaluru; Editing by Subhranshu Sahu and Nick Macfie)