FTSE 100 rises, led by Glencore, Next earnings; banks slide
FTSE 100 Market Overview and Key Movers
Aug 5 (Reuters) - London's FTSE 100 edged higher on Wednesday after strong earnings from Glencore and retailer Next, although gains were capped by a selloff in banking stocks following a report that China plans to tax returns from offshore insurance products.
The blue-chip FTSE 100 index closed up 0.01% to 10,888.3 points, while the midcap FTSE 250 climbed 0.7% to 24,632.63 points, notching another closing record high.
Major Contributors and Detractors
Positive Performers
AstraZeneca
• AstraZeneca rose 2.9% and was among the largest approximate contributors to the FTSE 100's gain after Reuters exclusively reported that there were no active discussions with Bristol Myers Squibb over a potential deal.
Glencore and Industrial Miners
• UK-listed shares of Glencore rose 4.1% after the Swiss miner beat forecasts with an 86% leap in first-half earnings, driven by its commodity trading business as conflict in the Middle East fuelled market volatility. It also said it was planning a secondary listing in Australia.
• Other industrial metal miners such as Rio Tinto and Antofagasta, also offered support to the FTSE 100 index, as copper prices hit their highest level in 12 weeks. [MET/L]
Next
• Clothing retailer Next jumped 6.9%, becoming the top gainer in the FTSE 100, as it lifted its annual profit outlook for the third time this year.
Negative Performers
Banks and Insurers
• Prudential slumped 6.4%, while HSBC fell nearly 5% after Caixin reported Chinese mainland tax authorities have started levying personal income tax on returns from offshore insurance policies, the latest sign of greater scrutiny of offshore investments.
Energy Sector
• Energy stocks slipped 1.5% amid volatile oil prices as investors assessed whether efforts to end the Iran war and restore traffic through the blockaded Strait of Hormuz were making progress. [O/R]
Geopolitical and Policy Developments
Middle East Tensions
• Yemen's Iran-aligned Houthi rebels said they attacked a Saudi oil tanker in the Red Sea, denting investor hopes of a de-escalation in the Middle East conflict after Qatar said on Tuesday that mediators were making progress in peace talks.
UK Government Fiscal Policy
• Britain's Treasury is considering using flexibility within the government's fiscal rules to raise billions of pounds in additional borrowing for investment in infrastructure, housing and business support, The Times reported, citing comments from finance minister John Healey.
(Reporting by Anand Gopal in Bengaluru; Editing by Vijay Kishore and Joyjeet Das)
