LONDON MARKET CLOSE: Miners lift FTSE 100 while oil price heads lower

Tue, 02nd Jun 2026 17:12

(Alliance News) - The FTSE 100 made steady progress on Tuesday, with events in the Middle East continuing to largely dictate the market mood.

The FTSE 100 closed up 34.56 points, 0.3%, at 10,373.51. The FTSE 250 ended up 132.58 points, 0.6%, at 23,378.36, while the AIM All-Share fell 0.92 of a point, 0.1%, to 818.32.

The Cboe UK 100 ended up 0.5% at 1,031.90, the Cboe UK 250 was 0.3% higher at 20,043.35, and the Cboe Small Companies Index ended up 0.2% at 18,917.09.

The modest gains for London's blue-chips came after US President Donald Trump insisted that peace talks with Iran were moving rapidly and that Israel and Hezbollah had agreed to stop fighting – though Israeli strikes resumed Tuesday.

On Monday, Iranian news agency Tasnim reported that Tehran had suspended dialogue with mediators in protest against Israel's expanding Lebanon offensive.

"There is no concrete progress in Middle East negotiations to hang a hat on, but investors appear broadly optimistic that a longer-term resolution will be reached," said Susannah Streeter, chief investment strategist at Wealth Club.

While David Morrison at Trade Nation noted that despite the oil market turmoil, "prices remained near the bottom of their recent range", and well below the USD100 a barrel seen a few weeks ago.

Brent crude for August delivery traded lower at USD94.68 a barrel on Tuesday, down from USD97.22 at the time of the equities close in London on Monday.

In European equity markets on Tuesday, the CAC 40 in Paris ended up 0.8%, and the DAX 40 in Frankfurt closed 0.5% higher.

In New York, the Dow Jones Industrial Average was up 0.3%, the S&P 500 was 0.2% higher, and the Nasdaq Composite firmed 0.3%.

US markets had posted record highs on Monday, as AI enthusiasm again sent tech stocks soaring.

Nvidia shares opened higher on Tuesday after jumping more than 6% on Monday after unveiling a powerful laptop chip for Windows machines.

That came as Google parent Alphabet announced plans to raise up to USD80 billion in stock to fund a major expansion of its AI infrastructure, with Warren Buffett's Berkshire Hathaway committing USD10 billion.

And Anthropic, maker of the Claude chatbot, said it had filed confidentially for an initial public offering that could value the AI group at nearly one trillion dollars.

Wealth Club's Streeter noted Anthropic's news comes "hot on the heels" of SpaceX's filing, and "there are expectations that OpenAI will also go public pretty soon."

The listings are set to intensify excitement around AI, but they may also fuel concerns that parts of the market may be entering bubble territory, Streeter said.

"High-profile IPOs can still become turning points for market sentiment if valuations appear too detached from fundamentals. Any disappointment could trigger a wider reassessment across tech stocks, which have soared in value," she added.

The pound traded at USD1.3475 on Tuesday afternoon, up from USD1.3447 on Monday. Against the euro, sterling firmed to EUR1.1578 from EUR1.1570 on Monday.

The yield on the US 10-year Treasury trimmed to 4.45% on Tuesday from 4.51% on Monday. The yield on the US 30-year Treasury narrowed to 4.96% from 5.01%.

In Europe, figures showed inflation in the eurozone speeding up, putting pressure on the European Central Bank to hike interest rates next week.

According to a flash reading from Eurostat, the harmonised index of consumer prices rose 3.2% annually in May, speeding up from the 3.0% rise posted in April. The reading was in line with FX Street-cited consensus.

Core HICP, which excludes food, energy and alcohol & tobacco, accelerated to 2.5% in May from 2.2% in April, ahead of FXStreet consensus of 2.4%, hitting its highest level since April last year.

"A week ahead of the next ECB meeting, this is the expected uptick in inflation that will motivate the central bank to decide on an 'insurance' hike," suggested ING Global Head of Macro Carsten Brzeski.

Iain Simmons at Oxford Economics said that while small, the acceleration in inflation will "remain uncomfortable for the ECB and in our view confirms that the central bank will hike rates in June."

The euro traded higher against the greenback, at USD1.1638 on Tuesday against USD1.1624 on Monday. Against the yen, the dollar was trading at JPY159.89, higher than JPY159.64.

Gold traded at USD4,503.10 an ounce on Tuesday, up from USD4,472.82 on Monday.

On the FTSE 100, miners Antofagasta, Anglo American and Glencore led the gainers, up 6.5%, 4.1% and 4.6% respectively, as metals prices rose.

But British American Tobacco fell 2.5% despite reiterating full-year guidance for group revenue to rise by between 3% and 5% for 2026.

For the global cigarette industry as a whole, BAT expects volumes to decline by 2.5% in 2026, worse than the previously forecast 2%.

Citigroup analyst Simon Hales said the combination of the lower global cigarette industry volume estimate, slower than expected first half recovery in Asia-Pacific, Middle East & Africa, an 80 basis points share loss in US combustibles, and Philip Morris's announcement that it is launching ZYN Ultra nicotine pouches in the US this month is likely to be seen as a negative for the firm.

On the FTSE 250, Elementis rose 2.9% as it pledged a EUR30 million share buyback, using the proceeds from the sale of its pharmaceutical manufacturing business.

GB Group fell 16% after announcing GBP6 million in investment, which it said will impact near-term margins, with benefits to come in later years.

"This will impact short-term numbers, which may annoy some. However, in the context of the valuation, we think management should be backed for making positive strategic moves.

"We continue to believe the valuation overlooks today's growth, let alone future growth potential," analysts at Jefferies said.

The biggest risers on the FTSE 100 were Antofagasta, up 268.00p at 4,408.00p, Glencore, up 26.90p at 615.00p, Anglo American, up 168.00p at 4,225.00p, Barclays, up 15.40p at 470.20p and Intercontinental Hotels Group, up 5.05p at 158.20p.

The biggest fallers on the FTSE 100 were Airtel Africa, down 18.40p at 334.60p, Sage Group, down 36.80p at 870.80p, Endeavour Mining, down 167.00p at 4,250.00p, Experian, down 88.00p at 2,588.00p and London Stock Exchange Group, down 262.00p at 8,924.00p.

Wednesday's global economic calendar has Australian GDP data overnight, a slew of composite PMI readings, ADP payroll data and the Federal Reserve's Beige Book.

Wednesday's local corporate calendar has full-year results from DiscoverIE Group and third-quarter results from Seraphim Space Investment Trust.

By Jeremy Cutler, Alliance News reporter

Comments and questions to newsroom@alliancenews.com

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