The FTSE 100 posted modest gains on Tuesday, although it lagged a strong rally on Wall Street as weakness in oil producers offset strength in mining stocks.
The leading index added 0.2%, while the FTSE 250 outperformed with a 1.0% gain, helped by strong corporate updates from Travis Perkins and several mid-cap names.
Mining companies provided the biggest lift to the FTSE 100 after higher metals prices boosted the sector. Antofagasta climbed 6.9%, Anglo American gained 5.5% and Endeavour Mining advanced 3.4%, helping counter losses elsewhere in the index.
BP beats forecasts but shares reverse lower
BP reported second-quarter figures ahead of expectations, with underlying replacement profit before interest and tax climbing to $10.31 billion from $5.25 billion a year earlier, exceeding the company consensus forecast of $9.48 billion.
New chief executive Meg O’Neill described it as a strong quarter but acknowledged the business had areas where performance “fell short”. She said BP had already made progress strengthening its balance sheet and outlined plans to sharpen the group’s focus, just a day after announcing it would seek a buyer for its US biogas business, Archaea, which was acquired in 2022 for $3.3 billion.
O’Neill said the company needed to “get fit to grow”, identifying stronger financial discipline as a priority alongside wider operational improvements.
Despite the earnings beat, BP shares failed to hold early gains as crude prices retreated. Brent oil moved closer to $80 a barrel after US Treasury Secretary Scott Bessent said an agreement with Tehran to reopen the Strait of Hormuz to shipping traffic could be reached by Wednesday.
The decline in crude prices dragged BP down 4.9% by the close, while Shell lost 2.5%.
Smith & Nephew disappoints as Travis Perkins rallies
Smith & Nephew was the weakest performer on the FTSE 100, falling 6.3% after reducing its full-year sales growth forecast to 4% from around 6%.
Second-quarter underlying revenue growth of 1.6% missed expectations as demand for hip and knee implants in the US remained weaker than anticipated, prompting analysts at Panmure Liberum to describe the update as disappointing.
On the FTSE 250, Travis Perkins jumped 18% after reporting interim adjusted operating profit of £67 million, ahead of market expectations, with management pointing to encouraging early progress in its turnaround strategy.
AG Barr lost 5.4% after supply chain disruption reduced product availability, while CLS Holdings fell 8.0% after warning full-year earnings would come in below market forecasts as leasing activity remained slower than expected.
Wall Street rallies on technology earnings
European markets enjoyed a firmer session, with France’s CAC 40 rising 0.6% and Germany’s DAX gaining 0.8%.
US stocks significantly outperformed London, driven by another surge in technology shares. The Nasdaq Composite climbed more than 2.5%, while the S&P 500 rose 1.8% towards another record close and the Dow Jones Industrial Average gained 1.8%.
Palantir soared 26% after reporting quarterly results that chief executive Alex Karp described as “otherworldly”, while Caterpillar gained 6% after annual sales topped $20 billion for the first time.
Investors will now turn their attention to SpaceX’s first earnings report since its June stock market debut, with markets closely watching its outlook, capital spending plans and the expiry of a share lock-up period later this week, which could substantially increase the number of shares available for trading.