FTSE 100 muted as energy gains offset broader drag; Iran, Xi visit watched

By Reuters News

Sept 23 (Reuters) - London's FTSE 100 was muted on Wednesday as oil prices rebounded to over $100 a barrel, reviving inflation worries and pushing up global bond yields as the focus remained on any developments around the Middle East conflict.

The blue-chip FTSE 100 index .FTSE was little changed at 10,705.26 points, while the midcap FTSE 250 .FTMC slipped 0.7%. The latter marked its steepest one-day fall in nearly two weeks.

  • Oil prices rose after five straight sessions of losses, surpassing $100 a barrel. Energy stocks .FTNMX601010 climbed 2.2% with oil majors BP BP.L and Shell SHEL.L rising 2.7% and about 2% respectively. O/R

  • Yields on global government bonds soared, with the 10-year US Treasury note yield up at 5.083%, its highest since 2007. Yield on the benchmark British gilt rose to 5.353%.

  • The first known indirect talks between the US and Iran in months raised hopes for progress toward ending the Middle East conflict, though neither side signalled a shift in stance.

  • Most sectors on the FTSE indexes closed lower. Pharma stocks .FTNMX201030 were the biggest drag on the index with a 1.5% fall, with AstraZeneca AZN.L and GSK GSK.L shedding 1.9% and 1.1% respectively.

  • On the flip side, industrials stocks rose, powered by a 1.4% gain in Rolls-Royce RR.L. The aerospace and defence sector .FTNMX502010 also added 1.4%.

  • Market attention was on Washington as Chinese President Xi Jinping begins a three-day visit, with trade, technology and Tehran tensions in focus.

  • Among individual stocks, JD Sports JD.L slid 5.7% after the sports and fashion retailer reported around a 20% drop in first-half profit, becoming the top loser on the benchmark index.

  • Two sources told Reuters that Pollen Street POLNP.L had explored options, including a potential sale to scale up its asset management business. The private capital firm topped the mid-cap index with a 12.5% rise.

  • A survey showed growth in British business activity cooled this month and inflation pressures built, an awkward backdrop for finance minister John Healey ahead of his first budget next month.

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