July 3, 2018 / 9:20 AM / a month ago

FTSE ticks higher, Glencore takes a tumble

LONDON (Reuters) - Britain’s top share index climbed on Tuesday following a shaky start to the month, although mining giant Glencore (GLEN.L) fell after one of its subsidiaries received a U.S. subpoena.

People walk past the London Stock Exchange Group offices in the City of London, Britain, December 29, 2017. REUTERS/Toby Melville

The blue-chip FTSE 100 .FTSE index was up 0.6 percent at 7,593.29 points at its close, making back some of Monday's 1.2 percent loss when concerns over global trade hit risky assets.

The mood was upbeat across the wider European equity trading landscape after German Chancellor Angela Merkel’s conservatives settled a row over migration late on Monday evening that had threatened to topple her fragile governing coalition.

“Granted some (investors) remain nervous on the outlook for Brexit and the overall impact of U.S. policy but we see this as an opportunity to gain exposure as the recent drop was not a true reflection of equity asset prices,” Atif Latif, director of trading at Guardian Stockbrokers, said.

On the FTSE, consumer staples, energy and financials added the most points to the index.

Shares in big defensive companies topped the index, with telco BT (BT.L), British American Tobacco (BATS.L) and utility Severn Trent (SVT.L) all up more than 2 percent.

Shares in IAG (ICAG.L) also rose 1.5 percent on the back of a supportive research note from Credit Suisse in which analysts raised their price target for the British Airways-owner, saying that they expect efficiency gains to drive up margins.

Miners, however, were a weak spot as Glencore (GLEN.L) dropped more than 8 percent and hit a one-year low. The miner said that a subsidiary had received a U.S. Department of Justice subpoena on compliance with money-laundering laws.

“Shock news like this is clearly negative for the company, but the move lower is no doubt exacerbated by the timing of the news release, which was just after UK equities opened,” Jordan Hiscott, chief trader at ayondo markets, said.

The broader FTSE 350 mining index .FTNMX1770 fell 1.8 percent. The sector has come under pressure from uncertainty over the U.S. trade dispute with China, which has kept a lid on underlying copper prices.

The FTSE 100 has dipped back into negative territory for the year, down 1.2 percent year to date, though it has managed to slightly outperform a 2.1 percent decline for the Euro stoxx .STOXXE index.

British mid caps .FTMC rose 0.3 percent, helped by gains in industrials and financials.

Reporting by Kit Rees; Editing by Louise Heavens and Peter Graff

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