FTSE 100 inches higher as industrial miners jump

London's FTSE 100 rose on Tuesday, led by heavyweight miners, while worries that central banks could taper asset purchases sooner than expected eased following to a recent rise in global COVID-19 infections and slower economic growth.

The FTSE 100 index inched 0.1% higher and was set to rise for a third consecutive session. Industrial metal miners and oil stocks led the gains, climbing 1.2% and 0.6% respectively.

However, limiting the advances were heavyweight bank stocks that weakened 0.6% to be the top losing sub-index in early trade.

The FTSE 100 has added 10.3% so far this year, but is still 8% away from its record highs hit in 2018 and underperforming its developed market peers in the United States and Europe.

A slowing economy due to easing consumer demand, risks around central banks pulling back monetary support sooner than expected, and labour shortages have all weighed on the FTSE 100 recently.

"Market sentiments were largely battered by the record-breaking number of coronavirus cases in the Asian nations, certain domestic challenges including staff shortages, inadequacy of semiconductors and relatively lower consumer spending," said Kunal Sawhney, chief executive of Kalkine.

"With the Delta variant cases beginning to subside in the UK, market participants are now looking forward to the penultimate quarter of the present fiscal, with job vacancies remaining near record highs, effectively alleviating the fears of potential employment threat," Sawhney said.

The domestically focussed mid-cap index added 0.5%, inches away from record highs. Travel stocks were among the top boosts.

BHP Group rose 1.1% even after S&P Global said the miner was at risk of a two notch downgrade that would provoke its lowest ever credit rating, as the sale of its petroleum business raises the miner's dependence on its major business of iron ore.

Wood Plc dropped 4.6% after the engineering and consultancy firm forecast lower annual revenue and reported a 14.1% fall in first-half profit.