FTSE 100 recovers 1% on energy, mining stock boost

Heavyweight energy and mining stocks lifted London's FTSE 100 on Tuesday, with Royal Dutch Shell providing the biggest boost to the blue-chip index after it announced plans to sell its Permian Basin assets.


Reuters | London | Updated: 21-09-2021 14:14 IST | Created: 21-09-2021 13:45 IST
FTSE 100 recovers 1% on energy, mining stock boost
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Heavyweight energy and mining stocks lifted London's FTSE 100 on Tuesday, with Royal Dutch Shell providing the biggest boost to the blue-chip index after it announced plans to sell its Permian Basin assets. The blue-chip FTSE 100 gained 1% in early trading after hitting a two-month low in the previous session on inflation concerns. Oil major BP and miners BHP Group, Anglo American, and Rio Tinto were among the top boosts.

Royal Dutch Shell jumped 3.9% after it said it would sell its Permian Basin assets to ConocoPhillips for $9.5 billion in cash, exiting the largest U.S. oilfield. The FTSE 100 has gained 7.8% so far this year on support from dovish central bank policies and re-opening optimism. However, higher inflation pressures have raised skepticism among investors that central banks might hint later this week towards pulling back massive asset purchases sooner than expected.

"Investors are still progressing ahead with fingers crossed as the Fed and the BoE are unlikely to declare any tapering measures this time, as it would potentially unsettle the global equity environment before the third-quarter earnings season," said Kunal Sawhney, chief executive at Kalkine. The domestically focussed mid-cap index rose 0.9%, with travel stocks being among the top gainers.

In earnings-driven moves, Kingfisher fell 5.3% to the bottom of the FTSE 100 even as the British home improvement retailer reported a jump in first-half profit. "So far, it (Kingfisher) has managed to limit inflationary pressures, though concerns remain whether it will be able to continue to do so if the supply chain crunch continues well into next year," said Susannah Streeter, a senior analyst at Hargreaves Lansdown.

British transport company Stagecoach Group surged 16.7% after it said it was in talks with rival operator National Express about a possible all-share merger. Semiconductor technology company Alpha wave jumped 9.5% on raising its 2021 guidance after reporting a 140% rise in first-half revenue.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

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