LONDON, July 7 — London’s FTSE 100 rose today as heavyweight mining and energy stocks tracked commodity prices higher, while Royal Dutch Shell jumped on plans to boost shareholder returns.
Shell climbed 2.5 per cent to the top of the FTSE 100 as the company said it would boost its planned shareholder returns beginning in the second quarter after a sharp rise in oil and gas prices helped it reduce debt.
The blue-chip FTSE 100 rose 0.5 per cent, led by gains in energy and base metal stocks, up 2.2 per cent and 1.9 per cent respectively.
The domestically focussed mid-cap index gained 0.4 per cent, led by a 1.3 per cent rise in homebuilders.
British house prices in June fell in monthly terms for the first time since January as the government prepared to scale back its tax break for home-buyers, mortgage lender Halifax said. However, they rose 8.8 per cent in annual terms.
Homebuilder stocks have gained 1.4 per cent so far this year on rising home prices and demand for bigger homes, but have largely underperformed the FTSE 100.
Cheap borrowing costs, higher commodity prices and re-opening optimism have helped the FTSE 100 gain 10.5 per cent so far this year. However, the index has underperformed its European and local mid-cap peers.
“The mix of recovering employment with improved consumer sentiment, buttressed by record-low borrowing rates, a booming property market and a loose fiscal bias, has the potential to set off a virtuous cycle between household spending and corporate profits,” said Konstantinos Venetis, a senior economist at TS Lombard.
Global recruitment firm PageGroup jumped 3.9 per cent and was the top mid-cap gainer after it reported a 2 per cent rise in second-quarter gross profit.
Peer Robert Walters climbed 9.6 per cent after posting its first jump in net fees in a year on increased hiring.
Countryside Properties rose 0.7 per cent after it said it would focus solely on partnerships business following a strategic review of the potential separation of its housebuilding segment. — Reuters
