London close: FTSE ends a little firmer as miners rally, energy giants slide

(Sharecast News) - London stocks ended a little higher on Tuesday, underpinned by strength in the mining sector, but with energy giants Shell and BP under pressure as oil prices tumbled after US Treasury Secretary Scott Bessent signalled that a deal to open the Strait of Hormuz was imminent.

The FTSE 100 closed up 0.2% at 10,879.38, while Brent crude was down 5.4% at $79.29 a barrel and West Texas Intermediate was 5.7% lower at $75.79 after Bessent told CNBC's Squawk Box that the US was in talks with Iran over Hormuz.

"There is a chance we may have a deal today or tomorrow to open the Strait and move towards a more normalized position in this conflict," he said. Asked whether Iran would be allowed to charge a toll, he said: "It would be freedom of movement."

Patrick Munnelly at Tickmill Group said: "London moved modestly higher on Tuesday, with the FTSE 100 supported by strong gains in miners as global risk appetite improved on fresh hopes that the Strait of Hormuz could reopen to traffic and that the US and Iran may be moving toward a deal. The gains were not broad-based, however, as weakness in Smith & Nephew, HSBC, consumer names and selected financials kept the index's advance contained.

"The geopolitical focus remained the Strait of Hormuz. U.S. Treasury Secretary Scott Bessent said on CNBC that the waterway could be close to reopening, echoing comments from President Donald Trump a day earlier. The remarks lifted global sentiment, with the Dow and S&P 500 reaching all-time highs after investors priced in a lower risk of a prolonged disruption to one of the world's most important energy routes.

"For London, the immediate market response was more nuanced. On Monday, falling oil prices had weighed on BP and Shell but helped housebuilders and rate-sensitive stocks as gilt yields declined. On Tuesday, the prospect of a reopening of Hormuz supported broader risk appetite while also helping miners, which benefited from stronger global growth sentiment and a more constructive tone toward industrial commodities."

In equity markets, heavily-weighted miners were the top performers as copper prices rose, with Antofagasta, Anglo American and Rio Tinto all up.

Precious metals miner Fresnillo shone as it beat expectations with its interim results, helped by higher volumes and lower-than-forecast operating costs, with gross profits more than doubling compared with last year.

Travis Perkins surged as it reported a drop in first-half revenue and flat operating profits, but with analysts pointing to early signs of a turnaround at the builders' merchant.

Volution gained as it announced the acquisition of German ventilation firm GetAir for �40m.

Domino's also advanced after results, while Johnson Matthey shot up as Jefferies reinstated a 'buy' rating on the stock following full-year results and the Cormetech acquisition.

Segro gained after agreeing to be taken over by US logistics giant Prologis in a �14.3bn deal.

On the downside, BP and Shell gushed lower as oil prices tumbled late in the day. BP was also in focus as it said underlying profits more than doubled and operating cash flow soared in the second quarter as oil prices surged, but acknowledged that its operational performance "fell short" of expectations, with upstream plant reliability and refining throughput both lower.

HSBC fell despite posting a better-than-expected 23% jump in first-half profit driven by a strong second quarter on the back of net interest income and fees. Pre-tax profit rose to $19.5bn, compared with the $18.9bn average forecast by analysts in a company-compiled consensus. The bank said it was resuming share buybacks with a $1bn repurchase plan.

Medical equipment manufacturer Smith & Nephew tumbled as it trimmed its fullyear revenue growth outlook on weak demand for knee and hip replacements in the US.

Coca-Cola Europacific also retreated as first-half results underwhelmed, with the company keeping full-year guidance unchanged as revenue and volume growth both slowed in the second quarter.

Housebuilder Vistry was under the cosh following a negative write-up by the Telegraph.

AG Barr fizzed lower as the Irn-Bru maker backed its full-year guidance as it reported a rise in interim revenue, but cautioned over a �10m revenue hit from supply chain issues.

Market Movers

FTSE 100 (UKX) 10,879.38 0.20%

FTSE 250 (MCX) 24,459.30 0.97%

techMARK (TASX) 6,091.01 0.68%

FTSE 100 - Risers

Antofagasta (ANTO) 3,931.00p 6.85%

Halma (HLMA) 3,742.00p 5.47%

Anglo American (AAL) 3,907.00p 5.45%

Fresnillo (FRES) 2,629.00p 5.24%

Rentokil Initial (RTO) 370.30p 3.78%

Melrose Industries (MRO) 480.70p 3.76%

Computacenter (CCC) 4,778.00p 3.73%

Barratt Redrow (BTRW) 314.70p 3.35%

ICG (ICG) 2,012.00p 3.23%

Rio Tinto (RIO) 7,313.00p 3.16%

FTSE 100 - Fallers

Smith & Nephew (SN.) 1,122.00p -6.27%

BP (BP.) 525.00p -4.91%

Coca-Cola Europacific Partners (DI) (CCEP) 7,735.00p -4.03%

Shell (SHEL) 3,321.50p -2.47%

Pearson (PSON) 1,227.50p -1.76%

British American Tobacco (BATS) 4,392.00p -1.66%

Admiral Group (ADM) 3,742.00p -1.58%

Tesco (TSCO) 479.00p -1.46%

Associated British Foods (ABF) 2,096.00p -1.27%

Haleon (HLN) 357.70p -1.27%

FTSE 250 - Risers

Travis Perkins (TPK) 678.50p 18.41%

Volution Group (FAN) 692.00p 8.98%

Domino's Pizza Group (DOM) 220.00p 7.74%

Seraphim Space Investment Trust (SSIT) 172.00p 6.44%

Johnson Matthey (JMAT) 2,100.00p 6.06%

Trustpilot Group (TRST) 279.60p 5.51%

Polar Capital Technology Trust (PCT) 669.00p 5.44%

Oxford Instruments (OXIG) 2,820.00p 4.73%

Raspberry PI Holdings (RPI) 686.50p 4.25%

QinetiQ Group (QQ.) 542.50p 4.13%

FTSE 250 - Fallers

Vistry Group (VTY) 284.00p -9.84%

International Workplace Group (IWG) 186.80p -6.37%

Ocado Group (OCDO) 204.60p -5.54%

Barr (A.G.) (BAG) 610.00p -5.43%

Diversified Energy Company (DI) (DEC) 975.00p -3.47%

Ithaca Energy (ITH) 231.40p -2.73%

XP Power Ltd. (DI) (XPP) 1,700.00p -1.85%

PPHE Hotel Group Ltd (PPH) 1,534.00p -1.79%

Hilton Food Group (HFG) 606.00p -1.62%

Clarkson (CKN) 5,075.00p -1.55%