FTSE lifts on gains for commodities, oil majors and banks

Commodity, oil and financial stocks helped the FTSE get off to a promising start to the week.

Weekend comments from the Bank of England’s Michael Saunders telling households to get ready for “significantly earlier” interest rate rises aided the start of trading while soaring energy prices boosted some firms.

The FTSE 100 closed 51.3 points, or 0.72%, higher at 7,146.85 on Monday.

Michael Hewson, chief market analyst at CMC Markets UK, said: “European shares have got off to a stodgy start to the week, although the losses are fairly contained, while the FTSE 100 has outperformed largely due to outperformance in financials and basic resources, while the FTSE 250 slipped.

“Rising aluminium and copper prices are helping to push the likes of Anglo American, Antofagasta and the big Australian miners of Rio Tinto and BHP higher, while oil prices above 80 dollars a barrel were also giving a lift to BP and Royal Dutch Shell.”

Brent crude increased by 1.86% to 83.92 dollars per barrel, taking it to the highest figure since 2018.

Financial stocks were also among the strongest performers as the hawkish comments from Bank of England rate-setters got the blood flowing.

“A sharp rise in UK yields, as investors price in the prospect of a Bank of England rate rise by year end, gave a lift to the likes of NatWest Group, Lloyds Banking Group and HSBC higher, in the hope that we’ll see an improvement in their net interest margins,” Mr Hewson added.

Elsewhere in Europe, the other major markets were far more subdued and finished the day with mixed results.

The German Dax decreased by 0.13% and the French Cac moved 0.08% higher.

Meanwhile, sterling was solid on the back of the speculation that interest rates could be on the way up.

The pound was flat versus the US dollar at 1.362 and was up 0.02% against the euro at 1.177.

In company news, the sudden departure of Asos chief Nick Beighton and a hefty profit warning shook investor sentiment in the online fast fashion retailer, sending shares tumbling.

The retail group said it expects pressures from its supply chains to continue at least until February and highlighted soaring shipping costs, which contributed to weaker-than-expected profits for the past year.

Asos was 373p lower at 2,408p at the close of play.

Good Energy Group slipped after it said the “ongoing volatility” in the UK energy sector and low wind speeds impacted performance in the third quarter of 2021.

Nevertheless, it dropped by 19p to 335p on Monday.

AstraZeneca shares made gains after the pharmaceutical giant told shareholders that its Covid-19 antibody drug cut the risk of severe disease or death in patients by 50%.

It closed 114p higher at 9,003p after trials showed its antibody cocktail AZD7442 showed a strong ability to reduce risk in patients who had symptoms for less than a week.

The biggest risers on the FTSE 100 were Anglo American, up 140p at 2,831p, Hargreaves Lansdown, up 60p at 1,461p, Antofagasta, up 57p at 1,420.5p, and Rio Tinto, up 172p at 5,101p.

The biggest fallers of the day were Ocado, down 59p at 1,565.5p, Intermediate Capital Group, down 52p at 2,034p, Tesco, down 5.25p at 270.35p, and JD Sports, down 15.5p at 1,026p.