By Johann M Cherian and Shashwat Chauhan
(Reuters) -London stocks closed higher on Monday as British lenders extended the previous session's gains, while mining stocks rose as precious and base metal prices appreciated.
The blue-chip FTSE 100 closed 0.3% higher, reaching its strongest level in two weeks in intraday trading.
Miners of both industrial and precious metals rose 1.2% and 0.8%, respectively, tracking a global rally in metal prices. [GOL/] [MET/L]
British banks rose 1.6%, extending Friday's gains.
Rate-sensitive stocks were amongst top gainers on Monday after the Bank of England raised its lending rate last week.
Beaten-down real estate and real estate investment trust sectors gained 1.7% and 1.9%, respectively, rebounding from Friday's losses.
"The recent rally for UK house builders regaining ground off the March lows suggests that investors are also eyeing the end of the BoE’s rate hiking cycle soon amid hopes that inflationary pressures will start to cool this year," said Victoria Scholar, head of investment at interactive investor.
Scholar, however, believes that with UK inflation still stuck above 10%, further rate hikes could come depending on the latest domestic data.
The mid-cap FTSE 250 index gained 0.4% as Trainline jumped 5.5% after Stifel raised the rail ticketing company's rating to "buy" from "hold."
John Wood Group tumbled 34.4%, its worst day on record after U.S. private equity firm Apollo Global Management said it does not intend to make a takeover offer for the oilfield services provider.
Halfway into May, top-gaining FTSE firms lie in the defensive segment such as utilities and healthcare, while cyclical sectors including commodity-linked stocks have been the most hit.
Currys jumped 3.0%, logging its best day in seven weeks after the electricals retailer raised its profit outlook for 2022-23.
ASOS (LON:ASOS) slid 20.7% after JP Morgan and Credit Suisse (SIX:CSGN) reduced their price target on the online fashion retailer.