London markets rebound as utilities firms make gains

The FTSE 100 moved 0.23%, or 16.85 points, higher to finish at 7,273.79.

Share prices in the City of London have not been as hot as the weather (Lucy North/PA) (PA Wire)

London stocks swung back to gains on Monday following a weak trading performance last week.

Improvements by utilities companies, such as Severn Trent, after rival Thames Water shored up its finances with £750 million of funding helped the main markets into the green.

The FTSE 100 moved 0.23%, or 16.85 points, higher to finish at 7,273.79.

Elsewhere in Europe, optimism over cooling inflation in Asia and other markets provided a welcome boost and caused bond yields to drop back.

Germany’s Dax index was flat for the day while the Cac 40 closed up 0.45%.

Michael Hewson, chief market analyst at CMC Markets UK, said: “Further weakness in yields has helped to procure a second successive day of gains for European markets, despite a slide in Asia markets after Chinese inflation slipped further towards deflation.

“Even the FTSE 100 is managing to eke out some gains today after losing further ground on Friday, rebounding from levels just above its March lows, despite seeing a drag from the basic resource sector.

“UK gilt yields have fallen back for the second day in succession, the first time in over a month we’ve seen two successive days of declines … a sign that perhaps we may have seen the highs in the short term.”

Across the Atlantic, the US markets also made gains as they rebounded from last week’s losses, with Monday trading boosted by Facebook owner Meta, which saw shares rise amid strong early sign-ups for its Twitter-rival app Threads.

Meanwhile, sterling slipped back after hitting a month high against the dollar last week.

The pound was down 0.03% to 1.283 US dollars and had decreased 0.24% to 1.167 euros at market close in London.

In company news, Severn Trent was higher at the end of trading after investors welcomed increased stability at rival Thames Water, which averted its threat of nationalisation with new equity funding. Severn Trent was up 38p at 2,432p.

Ocado shares dipped despite the online retail group’s first robotic warehouse in Asia, which was built for Japanese firm Aeon, starting operations.

The slip came after weekend reports in The Times newspaper that Ocado is expected to receive about 40% less than hoped in performance payments from M&S due to recent weakness.

Ocado shares were 10.4p lower at 581.6p.

Manchester-based legal services firm DWF Group saw shares leap higher after it confirmed it was in talks with Inflexion Private Equity partners over a potential £342 million takeover.

DWF said its shareholders would receive 100p per share if the deal gets the go-ahead. Shares in the company were 22.3p higher at 87.8p at the close of play.

The price of oil climbed to its strongest for about two months as worries over a potential US recession eased back further.

The price of a barrel of Brent crude rose by 0.5% to 78.51 US dollars at the time markets were closing in London.

The biggest risers on the FTSE 100 were: Flutter, up 470p at 15,155p; Ashtead, up 108p at 22,327.58p; Persimmon, up 18.6p at 993.2p; Admiral, up 38p at 2,067p; and IAG, up 2.8p at 160.1p.

The biggest fallers of the session were: Ocado, down 10.4p at 581.6p; National Grid, down 10.4p at 988.8p; Land Securities, down 5.6p at 566.6p; Sainsbury’s, down 2.6p at 267.9p; and Rio Tinto, down 46.5p at 4,868.5p.