FTSE 100 close: Rio Tinto and Glencore hoist London index as UK economy resumes growth

London’s FTSE 100 jumped today, led higher by industrial giants offsetting losses among retail and consumer-focused firms and housebuilders.

The capital’s premier index added 0.1 per cent to close at 7,602.75 points, while the domestically-focused mid-cap FTSE 250 index, which is more aligned with the health of the UK economy, was largely unchanged at 19,175.50 points.

Gains among the UK’s largest companies were concentrated in the raw materials sector, which represents a large share of the FTSE 100.

Miners Rio Tinto, Anglo American and Glencore all up by a range of four per cent and 2.5 per cent, aided by gains in raw material prices.

London’s FTSE 100 has a heavy gearing toward companies that produce key inputs in production, like copper and nickel. When the sector rises, it tends to lift the overall index along with it.

“The FTSE 100 was [boosted]… by a recovery for resources stocks helped make up for weakness elsewhere on the index,” Russ Mould, investment director at broker AJ Bell, said.

Today’s rises in the City came after numbers from the Office for National Statistics (ONS) revealed the UK economy is still continuing to dodge a much-tipped recession.

Gross domestic product in April jumped 0.2 per cent, a recovery from March’s 0.3 per cent contraction, although growth was weaker than the City expected.

There is concern that the UK could eventually slip into a recession later this year as the effects of the Bank of England’s twelve successive interest rate rises to 4.5 per cent grip the economy.

Markets yesterday also ratcheted up their bets on peak rates to 5.75 per cent from 5.5 per cent due to separate figures from the ONS showing wages are rising at the fastest pace on record outside of the pandemic at more than seven per cent.

Ladbrokes owner and gambling giant Entain slipped to the bottom of the FTSE 100, shedding nearly nine per cent after it announced yesterday it is buying Polish betting firm STS Holdings for £750m.

Fellow gambling company and Paddy Power owner Flutter was among the worst performers in the City, losing 1.71 per cent.

Gilt yields – which move inversely to prices – dropped today after surging above their post mini-budget levels yesterday.

Retailer Next and housebuilders were all lower in London today.

Pound sterling strengthened around 0.7 per cent to hit its highest level against the US dollar in over a year as traders step up their bets on how much higher UK rates will go.

Oil prices reversed strong morning gains to fall around 0.8 per cent.