The FTSE 100 closed up 28.02 points, or 0.3%, at 10,360.32 on Thursday, brushing off weakness in oil majors and Asia-focused financials.
The FTSE 250 ended 116.36 points, or 0.5%, higher at 23,302.65, while the AIM All-Share rose 1.02 points, or 0.1%, to 808.26.
Oil prices continued their volatile week as investors tracked developments in the conflict in the Middle East, where diplomatic efforts appeared to be stalling.
Iran reported “no tangible progress” in negotiations on ending the war, even as the US House of Representatives passed a resolution seeking to halt American military action in Iran.
Israel struck south Lebanon and threatened new attacks on Beirut, despite an announcement hours earlier that the opposing sides had agreed to implement a conditional ceasefire.
AJ Bell head of markets Dan Coatsworth said: “Domestic pressure on Donald Trump to end the war with Iran and a reported ceasefire between Israel and Lebanon have swung the pendulum once again for markets.”
Brent crude for August delivery traded lower at 94.88 dollars a barrel, down from 97.37 dollars at the time of Wednesday’s London equities close.
London-based oil majors BP and Shell fell 1.2% and 1.5% respectively, reflecting the broad decline in crude prices throughout the session.
Asia-focused financial stocks slumped after a media report that residents of mainland China were facing greater constraints in opening offshore accounts at major Hong Kong banks.
The South China Morning Post said as Beijing steps up its regulatory oversight on capital outflows, residents of mainland China are encountering greater constraints on opening offshore accounts, including outright prohibition, at mainland branches of major Hong Kong banks.
Insurer Prudential fell 7.2%, while lenders HSBC and Standard Chartered slid 2.2% and 3.2% respectively, making them among the session’s biggest losers.
JPMorgan noted China’s state council decree 837, effective July 1, has “generated meaningful noise around insurers, with mainland Chinese visitor exposure, such as Prudential.”
JPMorgan said: “While these headlines look concerning, we think they are likely to have little practical effect.”
UK construction data painted a grim picture, with the S&P Global construction purchasing managers’ index falling to 38.2 points in May from 39.7 in April, well below the 50-point growth threshold.
The index has now been below 50 points for 17 consecutive months, and May’s reading signalled the steepest decline in construction activity since May 2020.
Stocks that have suffered from AI disruption fears led the risers, with Relx up 6.0%, London Stock Exchange Group up 5.3% and Autotrader up 3.4%.
On the FTSE 250, CMC soared 17% as it said the next 12 months are expected to be a “defining” period for the group, forecasting operating income for financial 2027 well above market expectations.
The London-based trading platform reported pretax profit rose 20% to £101.3 million in the financial year ended March 31, with net operating income increasing 15% to £392.6 million.
CMC expects net operating income in the year ending March 31, 2027, to rise at least 17% to between £460 million and £480 million, well above the consensus of £385.5 million.
RBC Capital Markets raised its share price target for CMC to 460p from 400p and said it is raising financial 2027 and 2028 EPS forecasts by 23% and 30% respectively.
Broadcom’s stock plunged 14% in New York despite reporting record results, as expectations for AI revenue guidance fell short of lofty hopes, with analysts at UBS noting orders were strong but the company failed to raise AI revenue forecasts for 2026 or 2027.
Markets on Friday will be watching US nonfarm payrolls figures, alongside jobs data from Canada and the Halifax house price index in the UK.