By Johann M Cherian and Shashwat Chauhan
(Reuters) -Britain’s FTSE 100 closed higher on Tuesday, buoyed by commodity-linked stocks, but came off its session high as caution prevailed after the Bank of England (BoE) said it was on alert following recent turmoil in the banking sector.
The blue-chip index closed 0.2% higher, after hitting a near one-week high earlier in the day.
Bank of England officials said the central bank was on alert amid global turmoil in the banking sector but added that Britain was not experiencing stress linked to the demise of Silicon Valley Bank and Credit Suisse.
“What (Governor) Andrew Bailey has said is that while banking regulations have been put in place to make sure that the sector is healthy, perhaps the banking sector has moved on so much since those regulations were put in place since the financial crisis that we need to look again,” said Danni Hewson, head of financial analysis at AJ Bell.
“It’s been a bit of a rude awakening for investors, but these cracks have been appearing and nobody noticed.”
Shares of BP hit a two week high, finishing 2.4% up after the oil firm and Abu Dhabi National Oil Co (ADNOC) made an offer to jointly acquire 50% of Israeli offshore natural gas producer NewMed Energy for around $2 billion.
The broader energy sector gained 1.9% tracking higher oil prices. [O/R]
Miners of precious <.FTNMX551030> and base metals also gained 0.8% and 1.8% respectively, tracking strength in metal prices. [GOL/] [MET/L]
The mid-cap FTSE 250 index though, fell 0.7% as Synthomer tanked 10.9% after the polymer maker said its annual profits were hit due to subdued demand.
With another week left to wrap up the month, London’s FTSE 100 is on track to eke out marginal gains for the quarter, but is set to post its worst March performance since 2020 as concerns about the banking crisis ratcheted up market volatility.
(Reporting by Johann M Cherian and Shashwat Chauhan in Bengaluru; Editing by Sherry Jacob-Phillips, Rashmi Aich and Giles Elgood)
