UK's FTSE 100 rises on utilities, energy boost; Burnham becomes Labour Party leader
FTSE 100 Performance and Market Drivers
July 17 (Reuters) - London's FTSE 100 ended higher on Friday as utilities shares rose and energy giants gained, tracking higher crude oil prices amid escalating Middle East tensions, while the focus was on politics as Andy Burnham became the British Labour Party leader.
The blue-chip FTSE 100 index gained 0.3% at 10,600.4 points, while the midcap FTSE 250 dipped 0.5% to snap a six-day winning streak. Both indexes, however, clocked weekly gains.
Global Events Impacting Markets
Middle East Tensions and Oil Prices
• The United States struck bridges and an airport in Iran, provoking Tehran to respond by hitting a power and desalination plant in Kuwait.
• Energy stocks gained 2.1% as oil prices rose on concerns over supply disruptions.
Sectoral Performance
Utilities and Consumer Sectors
• Utilities rose 2.7%, leading sectoral gains, while food, beverages and tobacco added 1.6%.
Travel, Leisure, and Financial Stocks
• Higher crude oil prices weighed on travel and leisure, which fell 0.9%.
• Financial stocks were weaker with banks down 0.4%, while investment bank and brokerage services shed 1.5%.
Personal Goods and Company-Specific Moves
• Personal goods fell 5% after Burberry warned that the conflict in the Middle East was hurting tourist spending in Europe, sending shares in the British luxury brand down 6.4% despite strong sales growth in the United States and China during the April-June quarter.
• Among other stocks, GSK fell 2% after the drugmaker said it would halt development of its experimental treatment for refractory chronic cough after the therapy failed a late-stage trial and missed key efficacy goals across multiple dosages.
Political Developments
Burnham Elected Labour Party Leader
• On the political front, Burnham was elected leader of Britain's governing Labour Party, the final step before becoming its seventh prime minister in a decade on a pledge to thwart the rise of the populist Reform UK.
(Reporting by Tharuniyaa Lakshmi and Shashwat Chauhan in Bengaluru; Editing by Shinjini Ganguli and Joe Bavier)