(Sharecast News) - London stocks nudged up in early trade on Monday, but lenders surged after the Supreme Court ruled largely in favour of banks in the car finance case.
At 0845 BST, the FTSE 100 was 0.1% firmer at 9,076.62.
In its long-awaited ruling on car finance, the Supreme Court announced late on Friday that hidden commissions from lenders to dealers on car loans were not unlawful. The ruling means that millions of motorists will not be able to claim compensation.
Following the ruling, the Financial Conduct Authority said it will consult on running a compensation scheme.
In a statement on Sunday, the FCA estimated that most individuals would probably receive less than 950 in compensation.
Lloyds jumped to the top of the FTSE 100 on the back of the ruling. The bank said it will keep its 1.2bn motor finance provision under review but that there was unlikely to be any material changes.
Barclays - which had set aside 90m to cover any potential motor finance payouts - also gained.
Meanwhile, Close Brothers, which had set aside 165m, rocketed to the top of the FTSE 250 after the ruling.
Danni Hewson, head of financial analysis at AJ Bell, said: "Lenders will be relieved that they've avoided having to potentially pay out millions of pounds in compensation to motorists who hadn't been fully informed about the levels of commission being paid to their dealers.
"Most people buying a car in the UK take out finance and most won't have scrutinised the small print before pocketing the keys and driving off the forecourt and it was this lack of transparency which formed the basis for the original court case.
"But the Supreme Court was clear that an earlier ruling in favour of motorists was wrong, that the commission paid to dealers was neither a bribe nor could anyone have expected a dealer not to have a commercial interest in selling cars."
BP gushed higher as it announced its tenth oil and gas discovery of the year after drilling at the Bumerangue prospect in the deepwater offshore Brazil.
On the downside, medical products firm Convatec slumped after saying that chief executive Karim Bitar would be taking a medical leave of absence from the company,
Auction Technology tumbled as the online marketplace operator said it had bought Chairish, a US-based marketplace for vintage furniture and art, for $85m.
Senior also lost ground after its first-half revenues missed estimates.
Market Movers
FTSE 100 (UKX) 9,076.62 0.09%
FTSE 250 (MCX) 21,786.26 0.40%
techMARK (TASX) 5,240.50 -0.11%
FTSE 100 - Risers
Lloyds Banking Group (LLOY) 80.60p 6.42%
Barclays (BARC) 363.05p 1.79%
BAE Systems (BA.) 1,848.50p 1.76%
International Consolidated Airlines Group SA (CDI) (IAG) 380.10p 1.60%
Melrose Industries (MRO) 545.20p 1.38%
BP (BP.) 403.95p 1.32%
Antofagasta (ANTO) 1,913.00p 1.22%
Smurfit Westrock (DI) (SWR) 3,350.00p 1.21%
NATWEST GROUP (NWG) 517.60p 1.17%
easyJet (EZJ) 489.00p 1.16%
FTSE 100 - Fallers
Convatec Group (CTEC) 227.00p -1.73%
Reckitt Benckiser Group (RKT) 5,482.00p -1.58%
Haleon (HLN) 360.50p -1.34%
British American Tobacco (BATS) 4,080.00p -1.23%
AstraZeneca (AZN) 10,970.00p -1.21%
Pearson (PSON) 1,127.00p -0.92%
Rentokil Initial (RTO) 358.30p -0.91%
Fresnillo (FRES) 1,417.00p -0.84%
Unilever (ULVR) 4,496.00p -0.77%
Diageo (DGE) 1,808.00p -0.77%
FTSE 250 - Risers
Close Brothers Group (CBG) 485.40p 22.02%
Clarkson (CKN) 3,620.00p 6.00%
Aston Martin Lagonda Global Holdings (AML) 68.95p 2.83%
NextEnergy Solar Fund Limited Red (NESF) 76.35p 2.48%
Patria Private Equity Trust (PPET) 537.00p 2.48%
W.A.G Payment Solutions (WPS) 83.60p 2.20%
Paragon Banking Group (PAG) 907.50p 1.97%
Carnival (CCL) 2,033.00p 1.93%
Fidelity China Special Situations (FCSS) 281.50p 1.62%
Vietnam Enterprise Investments (DI) (VEIL) 696.00p 1.61%
FTSE 250 - Fallers
Auction Technology Group (ATG) 380.00p -20.83%
Senior (SNR) 185.80p -4.23%
AO World (AO.) 89.00p -2.84%
Crest Nicholson Holdings (CRST) 177.00p -2.21%
Barr (A.G.) (BAG) 684.00p -1.44%
Ocean Wilsons Holdings Ltd. (OCN) 1,130.00p -0.88%
Inchcape (INCH) 680.00p -0.87%
Bakkavor Group (BAKK) 232.00p -0.85%
ITV (ITV) 81.10p -0.80%
Tate & Lyle (TATE) 530.50p -0.75%
47.89 (0.53%)
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