The UK's blue-chip FTSE 100 inched higher on Tuesday, led by gains in defence and financial stocks, notching gains for a sixth consecutive quarter as optimism surrounding a ceasefire in the Middle East lifted sentiment.
The internationally focused FTSE 100 index CURRENCYCOM:UK100 rose 0.1%, while the midcap FTSE 250 FTSE:MCX was flat. The blue-chip index gained in 11 of the last 12 months, with March being the only exception, as global markets roiled after the U.S. and Israel launched a war on Iran.
The FTSE 250 posted its biggest quarterly rise in five quarters but a monthly loss as politics took centre stage after Keir Starmer resigned as prime minister.
Banks (.FTNMX301010) added 0.8% and were up 20% for the quarter. Lloyds LSE:LLOY and Natwest LSE:NWG gained 2.1% and 1.6%, respectively.
Aerospace and defence stocks (.FTNMX502010) rose 2.1% after Starmer unveiled an extra £15 billion ($20 billion) to modernise Britain's depleted armed forces. Rolls-Royce LSE:RR., BAE Systems LSE:BA., Melrose Industries LSE:MRO and Babcock LSE:BAB were up between 2% and 3.3%.
Industrial metal miners (.FTNMX551020) rose 1%, tracking metal prices, while precious metal miners FTSE:NMX551030 lost 1.5%.
Economic data showed that Britain's economy grew 0.6% in the first quarter, but households felt a squeeze before the price pressures of the Middle East conflict.
A Lloyds survey showed that UK businesses' confidence about the economic outlook fell this month as cost pressures and global uncertainty continued to hurt.
The UK's biggest housebuilders are facing a potential multi-billion-pound class action lawsuit over alleged anti-competitive conduct, according to a consumer claim. The home construction index (.FTNMX402020) lagged on the FTSE 100 with a 1.6% decline, while Persimmon LSE:PSN, Barratt Redrow LSE:BTRW and Taylor Wimpey LSE:TW. fell between 1% and 3%.
Among individual movers, supermarket group Sainsbury's LSE:SBRY rose 1.3% after first-quarter results but said it expects the Middle East conflict to add to food inflation.
British holiday and insurance group Saga LSE:SAGA shares gained 6.7% after first-half cruise bookings topped expectations.
The UK car lobby group warned electric vehicle makers will have to pay £1.4 billion ($1.85 billion) in tariffs if there is no solution on local content requirements with the European Union. The automobiles index (.FTNMX401010) shed 2.3%.