FTSE up for second day as banks fight back from post-Brexit slump

29 Jun, 2016 2:03 pm

LONDON – Britain’s top share index climbed for a second straight session on Wednesday, led higher by financials and commodities-related stocks on expectations the Brexit process might not start anytime soon.

The blue-chip FTSE 100 index .FTSE was up 1.7 percent at 6,243.04 points by 0757 GMT, building on the previous session’s 2.6 percent jump. Stocks fell sharply on Friday and Monday after Britain voted in a referendum to leave the European Union.

Britain’s outgoing Prime Minister David Cameron said he had not faced overwhelming pressure to trigger immediately the exit clause in the EU treaty, despite some public statements to the contrary.

“Traders are focusing on a more positive side and they pounce on the opportunities which have arisen from the recent sell-off and try to bag some bargains,” Naeem Aslam, chief analyst at TF Global Markets, said.

Financials, which had slumped in the aftermath of last week’s Brexit vote, were among the top gainers.

The UK banking index .FTNMX8350 and the life insurance index .FTNMX8570 rose 2.2 percent and 3.6 percent respectively, while mining stocks .FTNMX1770 also climbed 2.1 percent, tracking a rise in metals prices.

Shares in Prudential (PRU.L), Aviva (AV.L), Barclays (BARC.L) and Anglo American (AAL.L) were 3.3 to 4.7 percent higher.

Chris Beauchamp, senior market analyst at IG, also said that there were a lot of opportunities to buy companies at cheap valuations with good yields.

“At least you know you’re getting it cheaper than you were last week and that you can ride out some of the volatility,” he said. “If you’ve got a time-frame that extends beyond the end of next week … then you want to go buying stuff if you can,” he added.

Tour operator TUI (TUIT.L), however, fell 4.3 percent after JP Morgan cut its target price on the stock. –Reuters

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