FTSE 100 closes higher as banks track strong US earnings
SPY•FTSE 100 closes higher after early losses
July 14 (Reuters) - Britain's FTSE 100 closed higher on Tuesday, reversing early losses, as bank stocks led gains after strong U.S. lender earnings kicked off the reporting season and a softer-than-expected U.S. inflation reading boosted bets on interest rate cuts.
The FTSE 100 .FTSE ended up 0.3%, at 10,529.39, having earlier fallen as low as 10,422.98. The FTSE 250 midcap index .FTMC was about flat at 23,406.83.
Banks, miners and energy stocks lead gains
- Wall Street banks posted strong second-quarter earnings with a boost from fees for advising on deals and surging trading revenue, lifting their peers across the pond. In the UK, Barclays BARC.L and HSBC HSBA.L both gained 1.9%, while Lloyds LLOY.L added 1%, offering the top boost to the FTSE 100.
- Glencore GLEN.L rose 3%, Rio Tinto RIO.L gained 3.3% and Anglo American AAL.L added 2.4% on strength in industrial metals prices. MET/L
- Energy stocks provided further support after BP BP.L rose 2.2%, saying robust oil trading and higher refining margins would lift second-quarter earnings. Shell SHEL.L gained 1.2% as Brent crude held above $85, near four-week highs. O/R
- Earlier, investor sentiment was dampened by growing bets on Bank of England rate hikes, higher oil prices amid Gulf tensions, and comments from a top Federal Reserve official that pointed to a near-term rate increase.
- Meanwhile, U.S. consumer inflation slowed more than expected in June, tempering expectations for U.S. Federal Reserve policy tightening and further boosting U.S. stocks. .N
- Healthcare stocks were the biggest drag. GSK GSK.L fell 1.7% and AstraZeneca AZN.L declined 2%.
- Debenhams Group DEBS.L rose 3.1% after the online retailer said positive trading momentum continued through June and July.
