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July 21, 2021, 9:37 a.m. EDT

U.K. stocks climb as government borrowing eases and resource stocks surge

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By Barbara Kollmeyer

The FTSE 100 joined in on the second-day of a rally for global equities on Wednesday, with heavily weighted resource stocks surging and signs of an ease in government borrowing.

The index /zigman2/quotes/210598409/delayed UK:UKX -0.70% rose 1.5% to 6,966.33, after a 0.5% gain the prior session and a 2.3% slump on Monday, which marked the biggest drop for the FTSE 100 since May. The pound /zigman2/quotes/210561263/realtime/sampled GBPUSD +0.2937% was largely flat against the dollar.

Another move up for global stocks took other assets along, such as oil prices /zigman2/quotes/209723049/delayed CL00 +2.14% , gaining over 1% as the commodity rose for a second day in a bid to recoup Monday’s sharp losses. Shares of BP /zigman2/quotes/207305210/composite BP -0.85% /zigman2/quotes/202286639/delayed UK:BP +0.68% and Royal Dutch Shell /zigman2/quotes/205095589/composite RDS.A -1.07% /zigman2/quotes/206428183/delayed UK:RDSA +0.73% climbed more than 2% each.

U.K. government figures showed that net borrowing in June dropped by £5.5 billion ($7.48 billion), or 19.4%, versus the previous month, with the driver on the revenue side as total receipts rose 18%, pointed out analysts at Investec Economics.

“Overall, although public sector net borrowing remains extraordinarily high from a historical prospective, it is a marked improvement from last year’s figures, in which PSNBx (public sector net borrowing excluding banks) peaked above £47 billion in April 2020,” said Investec analyst Ellie Henderson. An economic recovery since then has helped boost tax revenues and reduced government spending on COVID-19 pandemic programs, she said.

Among stocks on the move, shares of Next /zigman2/quotes/200704121/delayed UK:NXT -0.52% surged 6%, after the clothing retailer lifted fiscal 2021 profit guidance and declared a special dividend to return surplus cash to shareholders.

Luxury-goods company Mulberry Group /zigman2/quotes/200060911/delayed UK:MUL 0.00% reported a swing to pretax profit for fiscal 2021 on lower costs and said that its year-to-date performance has been boosted by both the U.K. and Asia.

Mining stocks were in focus, such as shares of Antofagasta /zigman2/quotes/200173667/delayed UK:ANTO -1.84% , which reported lower copper production for the second quarter of the year, and reaffirmed full-year targets. The company also sees moderate inflationary pressures ahead.  

/zigman2/quotes/210598409/delayed
UK : FTSE UK
7,118.24
-50.44 -0.70%
Volume: 110,985
Dec. 2, 2021 9:43a
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/zigman2/quotes/210561263/realtime/sampled
US : Tullett Prebon
1.3317
+0.0039 +0.2937%
Volume: 0.0000
Dec. 2, 2021 4:58a
loading...
/zigman2/quotes/209723049/delayed
US : U.S.: Nymex
$ 66.97
+1.40 +2.14%
Volume: 81,200
Dec. 2, 2021 4:48a
loading...
/zigman2/quotes/207305210/composite
US : U.S.: NYSE
$ 25.74
-0.22 -0.85%
Volume: 9.85M
Dec. 1, 2021 4:00p
P/E Ratio
13.30
Dividend Yield
4.91%
Market Cap
$84.66 billion
Rev. per Employee
$2.84M
loading...
/zigman2/quotes/202286639/delayed
UK : U.K.: London
335.15 p
+2.25 +0.68%
Volume: 6.83M
Dec. 2, 2021 9:43a
P/E Ratio
14.30
Dividend Yield
4.90%
Market Cap
£63.99 billion
Rev. per Employee
£2.21M
loading...
/zigman2/quotes/205095589/composite
US : U.S.: NYSE
$ 41.59
-0.45 -1.07%
Volume: 6.01M
Dec. 1, 2021 4:00p
P/E Ratio
35.43
Dividend Yield
3.05%
Market Cap
$160.57 billion
Rev. per Employee
$1.95M
loading...
/zigman2/quotes/206428183/delayed
UK : U.K.: London
£ 1,618.80
+11.80 +0.73%
Volume: 1.08M
Dec. 2, 2021 9:43a
P/E Ratio
40.01
Dividend Yield
0.04%
Market Cap
£121.37 billion
Rev. per Employee
£1.52M
loading...
/zigman2/quotes/200704121/delayed
UK : U.K.: London
7,978.00 p
-42.00 -0.52%
Volume: 28,815
Dec. 2, 2021 9:42a
P/E Ratio
17.55
Dividend Yield
0.00%
Market Cap
£10.06 billion
Rev. per Employee
£138,653
loading...
/zigman2/quotes/200060911/delayed
UK : U.K.: London
330.00 p
0.00 0.00%
Volume: 8,056
Dec. 2, 2021 8:00a
P/E Ratio
13.97
Dividend Yield
0.00%
Market Cap
£196.35 million
Rev. per Employee
£115,181
loading...
/zigman2/quotes/200173667/delayed
UK : U.K.: London
1,388.50 p
-26.00 -1.84%
Volume: 108,575
Dec. 2, 2021 9:42a
P/E Ratio
18.07
Dividend Yield
3.90%
Market Cap
£13.60 billion
Rev. per Employee
£172,054
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