Banks and oil majors help FTSE to gains despite rail strike confirmation

The FTSE 100 recovered some ground on Monday as finance firms and commodities all had a strong session.

Confirmation that rail strikes will still take place on Tuesday, Thursday and Saturday, after failed negotiations, could not take the steam out of the London markets.

The city’s top flight ended the day up 105.56 points, or 1.5%, at 7,121.81.

Michael Hewson, chief market analyst at CMC Markets UK, said: “European markets have enjoyed a decent start to the week in the absence of US markets with the FTSE 100 leading the way higher.

“Banks are seeing a decent rebound with some solid gains, led by the likes of HSBC and Standard Chartered, with Lloyds Banking Group not too far behind, on the back of hawkish comments from Bank of England MPC member Catherine Mann.

“BP and Shell are also enjoying a modest rebound as they look to pare some of the big losses we saw on Friday, when oil prices underwent their biggest daily decline in over a month.”

Elsewhere in Europe, the other main markets also came back slightly after the Fed’s bumper interest rate rise knocked stocks heavily last week.

The German Dax increased by 0.99% by the end of the session, while the French Cac rose 0.53%.

Meanwhile, sterling was aided by the comments made by Ms Mann, where she warned that drops in the value of the pound could push up inflation further and called for higher interest rates in response.

The pound was up 0.05% against the dollar at 1.225 and flat against the euro at 1.163.

In company news, Primark owner Associated British Foods made gains after investors welcomed its plans to trial a click and collect service, after previously shirking from online operations.

The group also said that Primark “remains on track to deliver a full-year adjusted operating profit margin of some 10%” as it highlighted cost increases across its food operations, although these have been offset by higher pricing.

Shares rose by 38.5p to 1,647p.

Casino and bingo hall operator Rank Group slid in value after it warned over profits for the second time in three months.

The gambling and gaming business said it had seen some recovery in the Grosvenor casino business since April, when it also cut its earnings forecast, but that it had been “considerably” weaker than expected.

Shares finished the day 16.8p lower at 82.4p.

Elsewhere, shares in Euromoney soared after the financial information firm confirmed it is being courted by two private equity groups in what could become a £1.6 billion takeover deal.

Euromoney said that Astorg Asset Management and Epiris have indicated they might pay 1,461p per share for the FTSE 250 firm, taking its shares 286p higher to 1,380p.

The price of oil stabilised after Friday’s major drop as traders took a breather amid the closure of the US markets.

Brent crude increased by 0.72% to 113.94 US dollars per barrel when the London markets closed.

The biggest risers in the FTSE 100 were IAG, up 8.14p at 120.58p, ITV, up 4.32p at 69.72p, HSBC, up 28.8p at 537.5p, Ocado, up 46.6p at 877.6p, Melrose, up 6.75p at 152.35p.

The biggest fallers of the day were Intermediate Capital Group, down 67p at 1,342.5p, Persimmon, down 86.5p at 1,851p, Berkeley, down 161p at 3,730p, Barratt, down 17.5p at 454.4p, and Howden Joinery, down 20.6p at 586.8p.