Insurance firms buoy FTSE
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File picture: Phil Noble File picture: Phil Noble
London - Britain's main share index rose on Monday, recouping part of a sharp drop at the end of last week, helped by strength in insurance companies.
Britain's FTSE 100 rose 37.35 points, or 0.6 percent, to 6,275.64 points, having shed 2.8 percent in the last two sessions of last week, which took the index to its lowest level since mid-November.
The index posted its biggest loss since September 28 on Thursday after European Central Bank President Mario Draghi announced stimulus measures that fell short of what was expected.
Having fallen less than European indexes last week, the FTSE 100 lagged a stronger recovery in continental shares, which gained around 1 percent.
Traders said that the index might trade within a recent 200 point range, with trade subdued before a long-awaited US Federal Reserve meeting next week.
“The ECB did want the markets wanted, but they didn't do half as much as the markets wanted ... (and now) we're in a little bit of a no-man's land, waiting for the Fed's decision,” Alastair McCaig, market analyst at IG, said.
Among top gainers were insurers, which rose after the Bank of England approved capital models for 19 UK firms, enabling them to lower costs under new rules.
Financial stocks - which include insurers as well as heavyweight banks - added more than 12 points to the index's advance, the top sectoral contributor to its gains.
The biggest drag on the index was the oil and gas sector, with energy stocks taking 10 points off the FTSE 100 index.
BP and Shell fell 1.8 percent and 1.5 percent respectively after Opec’s failure last week to agree an oil production ceiling pulled oil prices down towards 2015 lows.
“Opec seems to be fragmenting now, with an air of 'every member for itself' prevailing,” Mike van Dulken, head of research at Accendo Markets, said in a note.
“Without the protection of big producers like Saudi Arabia, smaller exporters will have little choice but to ramp up production, even if to do so would be counter-productive for the oil price.”
REUTERS