London's FTSE 100 breaks six-day losing streak on energy boost
FTSE 100 Performance and Market Drivers
April 28 (Reuters) - UK's FTSE 100 edged higher on Tuesday, snapping a six-day losing streak, as energy stocks got a boost from BP's stronger-than-expected first-quarter profit and higher crude prices due to persistent geopolitical tensions.
The blue-chip FTSE 100 index closed 0.1% higher at 10,332.79 points, while the midcap FTSE 250 slipped 0.8%, down for a fourth day in a row.
Energy Sector Highlights
BP and Shell Lead Gains
• BP shares rose 1.1% after its first-quarter profit more than doubled year-on-year. Rival Shell also added 1.1%, with both offering the biggest boost to the blue-chip index.
Tullow Oil's Surge
• Tullow Oil surged 11.4% after the West Africa-focused independent oil and gas producer forecast annual oil production to come in at the higher end of its outlook range after a strong start to the year.
Crude Prices and Geopolitical Tensions
• Further aiding energy stocks' advance was an extended rally in crude prices as the stand-off in the U.S.-Iran war persisted. [O/R]
Banking and Financial Sector Movements
Barclays' Performance
• Lender Barclays lost 0.2% after reporting a smaller-than-expected share buyback and a hefty provision linked to the collapse of lender MFS.
Upcoming Economic Events
Bank of England Policy Decision
• Attention later this week will turn to the Bank of England's policy decision, where the central bank is expected to keep rates on hold, with investors watching for any signs of it moving towards raising rates later in the year.
Broader Economic and Political Context
Impact of Geopolitical Tensions on Bond Yields
Rising Gilt Yields
• Persistent worries about the inflationary impact of the Iran war pushed government bond yields higher across Europe, with the UK's 10-year gilt yield briefly hitting 5% and clocking its highest closing level since 2008.
Energy Prices and Economic Vulnerability
• Britain's heavy reliance on natural gas has led investors to see its economy as especially vulnerable to the war-fuelled jump in energy prices. The FTSE 100 is down more than 5% from its late-February record high.
Domestic Political Developments
• Domestic politics was also on the radar, with British Prime Minister Keir Starmer's one-time closest aide, Morgan McSweeney, backing his former boss by taking responsibility for promoting the "wrong" appointment of Labour veteran Peter Mandelson as ambassador to Washington.
(Reporting by Medha Singh and Shashwat Chauhan in Bengaluru; Editing by Vijay Kishore and Leroy Leo)
