Markets

Blue Chips up as oil prices rally on back of Trump's threat to pull out of Iran deal

Donald Trump has ignored the pleas of Germany, Britain and France in pulling the US out of a nuclear accord with Iran

LONDON'S blue-chip index was lifted by a rally in oil prices following confirmation that the US is to pull out of the Iran nuclear deal.

Donald Trump said yesterday that the US would walk away from the international agreement, raising the prospect of a fall in supply from one of the world's largest oil exporters.

Brent crude hit its highest level for nearly three-and-a-half years, rising by 1.67 per cent to US$77.200 per barrel.

The FTSE 100, which has a large exposure to the energy industry, raced ahead of its European rivals, closing the day 1.28 per cent or 96.77 points higher at 7,662.52.

Energy firms were among the biggest winners from Mr Trump's announcement, with BP and Royal Dutch Shell climbing by 3.9 per cent and 3.4 per cent respectively.

The Cac 40 in France climbed by 0.23 per cent, while Germany's Dax was up 0.24 per cent.

The pound was flat against the dollar at 1.355. Against the euro, sterling was up 0.16 per cent at 1.144.

In UK stocks, Vodafone rose after it announced an €18.4 billion (£16.1bn) deal for a raft of Liberty Global assets across Europe.

The telecoms company said it had agreed to acquire operations in Germany, the Czech Republic, Hungary and Romania in a move that accelerates its "converged communications strategy".

Shares closed the session up 1.15p at 208.7p.

Embattled doorstep lender Provident Financial said it is on the road to recovery after a torrid year of profit warnings and regulatory sanctions.

Provident, which sells high-cost credit through its Vanquis Bank, Moneybarn and consumer credit businesses, said its recovery plan was on track and it would meet its annual targets, boosting its shares by 8.35 per cent or 53.6p to 695.6p.

JD Wetherspoon blamed the timing of the early May bank holiday for hitting third-quarter sales, while bemoaning "significant cost increases" in the second half of the financial year.

The pubs company logged a 3.5 per cent increase in like-for-like sales for the 13 weeks to April 29, while total sales increased 2.8 per cent. Shares were down 5p to 1,177p.

Shares in bakery chain Greggs tumbled after it warned full-year profits could flat-line after taking a sales hit from the Beast from the East and slower spring trading.

The retailer, which has nearly 1,900 shops across the UK, saw like-for-like sales growth in company-managed outlets slow sharply to 1.3 per cent in the first 18 weeks of the year, down from 3.5 per cent a year earlier.

Shares dropped by 192p or 15.15 per cent to 1,075p.

Burberry fell to the bottom of the FTSE 100 after Belgian billionaire Albert Frere sold his stake in the British brand.

Mr Frere, the richest man in Belgium, offloaded his 6.6 per cent holding in the fashion chain, which was held through his investment vehicle Groupe Bruxelles Lambert. Burberry's shares closed down 6& or 114.5p at 1,770p.

Surging popularity for cruise holidays has helped boost half-year earnings at travel giant Tui as families and young people take to the seas, but the company's shares took a hit, falling by 25.5p to 1,727.5p.

Chief executive Fritz Joussen hailed an "excellent" market outlook for cruises, which are becoming the trip of choice for younger holidaymakers as well.

Property developer St Modwen, meanwhile, is to sell off more than a quarter of its shopping centre portfolio, with the deals coming amid a prolonged retail slump.

The group said yesterday that it will dispose of two retail assets, the Longbridge Shopping Park in Birmingham and Wembley Central in London.

Shares closed the day down 2p at 412.6p.

The biggest risers on the FTSE 100 were Imperial Brands up 161.5p to 2,780p, BP up 21.6p to 572p, Evraz up 17.2p to 507.8p and BHP Billiton up 55p to 1,631.8p.

The biggest fallers on the FTSE 100 were Burberry down 114.5p to 1,770p, Compass Group down 75.5p to 1,508p, Rolls Royce down 13p to 830p and G4S down 3.9p to 257p.

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