FTSE makes gains after lift from mining firms

A jump by mining firms including FTSE newbie Thungela helped drive the index into positive territory, despite wider unease over the global economic recovery.

London’s top flight closed 17.87 points higher, or 0.25%, at 7,095.09 on Tuesday.

Michael Hewson, chief market analyst at CMC Markets UK, said: “It’s been a solid day of gains for the FTSE 100 today, however it is struggling to push beyond the 7,120 level and the highs last week, while the FTSE 250 is also slowly edging higher, on a day where markets appear to be drifting higher on inertia more than anything else.

“Not even a partial global internet outage was enough to generate any significant volatility.

“US markets underwent a rather mixed start to the week on Monday with big gains in meme stocks prompting a significant outperformance in the Russell 2000.”

The Dow Jones opened marginally down while the Nasdaq managed to ride the Reddit-driven wave again to make slender gains.

In mainland Europe, French traders were also reasonably positive but the Dax dipped at the close on the back of Germany’s announcement that the country’s industrial output fell by 1% in April.

The German Dax decreased by 0.23% and the French Cac moved 0.11% higher.

Meanwhile, sterling was steady as concerns over the potential for a delay in the latest easing of lockdown restrictions were offset by positive retail sales data.

The pound was flat versus the US dollar at 1.415 and increased by 0.05% against the euro to 1.161.

In London, housebuilders drifted towards the bottom of the pile after trader’s took stock following bumper gains on Monday due to the surge in house prices.

In company news, British American Tobacco moved higher after it hiked its annual sales outlook as it hailed record levels of new customers for its vaping and cigarette alternatives.

The tobacco giant said it added 1.4 million new customers in the first quarter for what it calls the new categories segment of the market and now expects revenues to rise by more than 5%.

Shares closed 11p higher at 2,785p as a result.

Elsewhere, British Airways owner IAG was among the day’s big fallers after Goldman Sachs downgraded its valuation of the airliner.

IAG shares dropped by 3.78p to 198.02p at the close of play.

Miner Thungela Resources, which was spun off from Anglo American on Friday, soared in trading as it almost recovered from heavy losses on Monday after criticism from short seller Boatman Capital Research.

It climbed by 33.02p to 144.04p on Tuesday but will not remain in the FTSE for long, as it intends to swap its primary listing to Johannesburg at the end of this week.

The price of oil nudged higher towards an 18-month high but recent momentum has slowed down amid continued questions over the predicted resurgence in summer travel.

Brent crude increased by 0.53% to 71.87 dollars per barrel.

The biggest risers on the FTSE 100 were Thungela Resources, up 33.02p to 144.04p, Intermediate Capital Group, up 127p to 2,283p, Flutter Entertainment, up 525p to 13,715p, Intercontinental Hotels Group, up 192p to 5,166p, and Whitbread, up 110p to 3,340p.

The biggest fallers on the FTSE 100 were Taylor Wimpey, down 3.3p to 170.05p, Smith & Nephew, down 28.5p to 1,472.5p, IAG, down 3.78p to 198.02p, Melrose Industries, down 2.85p to 164.1p, and Lloyds, down 0.73p to 48.9p.