Boosted by commodities, FTSE 100 ends higher

The British FTSE 100 index ended slightly higher on Monday as commodity stocks achieved notable gains. Investors looked ahead to the appointment of Liz Truss as Britain’s new prime minister against a deteriorating economic background.

The commodity-heavy FTSE 100 ended 0.1% higher, after falling as much as 1.2% earlier in the day, while the domestically oriented FTSE 250 shed 1.2%.

Oil majors Shell and British Petroleum gained 1% and 2.1% respectively on firm crude prices, while miners added nearly 2%.

After weeks of an often bad-tempered and divisive leadership contest, Truss, who is UK’s foreign minister, beat former finance minister Rishi Sunak in a vote of Conservative Party members.

Truss takes over as the country faces a crunch on household finances, industrial unrest, a recession and war in Europe. She has vowed to press ahead with promised tax cuts and action to tackle a deepening energy and cost of living crisis. read more

Hopes of policy support boosted some shares of retailers including Next and JD Sports.

Markets are concerned about the hardline approach towards the European Union or Northern Ireland.

Some investors are alarmed that tax cuts promised by Truss could aggravate Britain’s inflation problem, speeding up the BoE’s interest rate hikes and worsening a recession that the BoE expects to start this year.