Miners and oil majors edge FTSE up as commodities gain

It was a quiet open for UK equities ahead of a Bank of England meeting today, with oil majors and mining stocks tracking higher on both the FTSE 100 and mid-cap indices.

The main market edged up 0.08%, or 5 points, to 7,095 as it moved into ‘consolidation mode’ after a tumultuous start to the week, said AJ Bell investment director Russ Mould.

‘While recent market sentiment has been dictated by the US Federal Reserve, their counterparts in the Bank of England will take centre stage later today when it delivers its monthly address,’ he said.

‘Investors might expect some guidance on the future trajectory of UK interest rates although consumer prices are merely bubbling on this side of the Atlantic when compared with the boiling point they have already reached in the US.’

The blue chips were led by oil groups and miners as commodity prices continued to move higher, with iron ore, oil, and copper all logging gains this morning.

Royal Dutch Shell (RDSA) moved to the top of the index, adding 2.1%, or 29p, to £14.30 while peer BP (BP) gained 1.7%, or 5p, to trade at 328p.

Anglo American (AAL) was up 1.8%, or 51p, at £28.43 and BHP (BHP) pushed up 1.5%, or 31p, to £20.95.

Miners also made gains on the mid-cap index, with BlackRock World Mining (BRWM) investment trust climbing 2.5% to 603p, Tullow Oil (TLW) pushing 2.4% higher to 63p, and Cairn Energy (CNE) 2.1% higher at 170p.

However, this didn’t stop the FTSE 250 slipping to a loss, down 0.12%, or 26 points, to hit 22,653.

It was pulled lower by Sirius Real Estate (SRET), as the German property investor slid 1.9% to change hands at 111p. The reason for the fall was unclear but builds on losses made last week after if issued €50m (£42.8m) of corporate bonds.

Technology tools maker Oxford Instruments (OXIG) slipped 2.1% to £22.95 and insurer Lancashire (LRE) ticked down 1.8%.

In investment trust news, HarbourVest Global Private Equity (HVPE) gained 1.6% to £21.15 after reporting a 5.1% increase in its net asset value (NAV) in May. The £1.6bn portfolio, which is the UK’s largest private equity fund of funds, received $20.3m (£14.6m) in distributions over the month, up from $9m in April.

JPMorgan Japan Small Cap Growth & Income (JSGI) was down 0.96% at 506p despite doubling the return of its benchmark over the year to end of March. The fund delivered a NAV total return of 42.4% against the 21.7% benchmark rise. The shares have jumped 47.9% over the period, narrowing the discount to 8.7%. The majority of the outperformance was generated in the first six months of the year and allowed the trust to increase its dividend to 21.9p per share.