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Energy stocks boost British shares ahead of reopening decision

By Reuters

By Devik Jain and Amal S

– British shares ended higher on Monday, helped by gains in heavyweight energy stocks, while investors awaited the government’s decision on whether it would delay England’s complete reopening from a third national lockdown.

The blue-chip index, which rose as much as 0.7% to 7,187 touching its highest level since February 2020, ended 0.2% up. Oil majors BP and Royal Dutch Shell gained 1.9% and 2.7% respectively, tracking crude prices. [O/R]

The domestically focused mid-cap FTSE 250 index advanced 0.1%.

Prime Minister Boris Johnson is set to announce that the planned lifting of restrictions, which would see an end to limits on social contact, will be delayed following concern about the rapid rise of infections by the Delta variant of the coronavirus.

Health minister Matt Hancock will update parliament at around 1930 GMT after Johnson addresses the public at a news conference.

“The markets been aware that this (delay in reopening) is going to happen, and the reaction in the market is minimal,” said Keith Temperton, equity sales trader at Forte Securities.

Travel-related stocks fell 1.4%, with International Consolidated Airlines, Compass Group, Just Eat Takeaway.com and InterContinental Hotels Group among the top decliners.

“Leisure companies could be worst affected by any delay to lockdown easing in England as it will require a continuation of the social distancing rules,” said Russ Mould, investment director at AJ Bell.

After breaking above the 7,000 mark in mid-April, the FTSE 100 has oscillated in a narrow range on worries that a resurgence in COVID-19 cases might delay the reopening.

Among stocks, outsourcer Serco Group jumped 4.6% after it raised its 2021 profit outlook.

British broadcaster ITV gained 1% after a report that the UK would rein in online platforms’ power in an effort to protect public broadcasters.