UK stocks edge higher as mining and financial shares lift FTSE 100

The UK's benchmark FTSE 100 index edged higher on Tuesday, supported by gains in industrial mining, and financial stocks, as investor sentiment improved on optimism surrounding a ceasefire in the Middle East.

The blue-chip index was also on course to register its sixth consecutive quarterly gain.

By 0904 GMT, the internationally focused FTSE 100 was up 0.5%, while the domestically focused FTSE 250 gained 0.1%.

The FTSE 100 has recorded gains in 11 of the past 12 months, with March being the only exception.

Market sentiment had previously come under pressure after the United States and Israel launched military action against Iran.

Financial and mining stocks lead gains

Banking stocks were among the strongest performers during the session.

The banking index advanced 1.2% and was up more than 20% for the quarter.

Shares of Lloyds gained 1.8%, while NatWest rose 2.4%, contributing to the broader market's advance.

Industrial metal mining stocks also performed strongly, rising 2.1% in line with higher metal prices.

Rio Tinto, Anglo American, and Glencore gained between 1.7% and 2.8%.

The gains in mining and banking shares helped offset weakness in other sectors.

UK economy expands in the first quarter

Fresh economic data showed that Britain's economy grew 0.6% during the January-to-March quarter of 2026, matching expectations.

According to figures released by the Office for National Statistics (ONS), UK real gross domestic product increased by an unrevised 0.6% in the first quarter.

The growth followed a revised expansion of 0.1% in the final quarter of 2025.

The ONS estimated that all major sectors of the economy contributed to growth, with the services sector making the largest contribution.

Despite the stronger quarterly growth, the data also indicated that households experienced financial pressure before the additional price pressures linked to the Middle East conflict.

Business confidence weakens

Separate data from a Lloyds survey indicated that UK business confidence regarding the economic outlook declined during the month.

The survey suggested that persistent cost pressures and ongoing global uncertainty continued to weigh on corporate sentiment despite the stronger economic growth recorded in the first quarter.

Meanwhile, data from the British Retail Consortium showed that annual shop price inflation remained unchanged in June.

Food inflation moderated during the month, while consumers benefited from seasonal summer discounts.

Housebuilders under pressure

Housebuilding stocks were among the weakest performers after reports of a potential multi-billion-pound class action lawsuit over alleged anti-competitive conduct.

The home construction index fell 2.8%, making it the weakest-performing sector within the FTSE 100.

Shares of Persimmon, Barratt Redrow and Taylor Wimpey declined between 2.4% and 3.3%.

Among individual stocks, supermarket group Sainsbury's rose 2.1% after reporting its first-quarter results.

However, the company cautioned that the conflict in the Middle East could contribute to higher food inflation.

British holiday and insurance group Saga fell 3%, making it the biggest decliner on the FTSE 250 after reporting its first-half results.

The FTSE 250 remained on track to post a quarterly gain despite being set for a monthly decline, reflecting a mixed performance across domestic equities as political developments remained in focus.