UK stocks close higher amid gains in miners, banks

The ​blue-chip FTSE 100 index closed 0.58% higher, while the mid-cap FTSE 250 gained 0.28%

UK stocks closed higher on Wednesday, recovering from a sluggish start as gains in industrial miners and banks helped offset concerns over domestic political uncertainty.

The ​blue-chip FTSE 100 index closed 0.58% higher, while the mid-cap FTSE 250 gained 0.28%. Industrial miners added 4.36% and banks rose 1.44%, rebounding from a day earlier.

Intertek was one of the top gainers on the FTSE 100, closing 5.28% higher after the product testing ​company said on Wednesday it was ready to recommend a £9.4 billion ($12.7 ​billion) takeover proposal by Swedish private equity group EQT.

The gains helped ⁠reassure investors unsettled by the Middle East impasse, rising oil prices and renewed ​uncertainty over Prime Minister Keir Starmer’s future.

Health Minister Wes Streeting is preparing to resign ​and could quit as early as Thursday, the Times reported on Wednesday, adding that he is likely to mount a formal challenge for the party leadership.

That came despite Starmer’s plea to voters and ​his party’s lawmakers to stick with him and avoid a leadership contest he ​said would only bring chaos.

The Prime Minister may be ‘forced’ to step down if enough ministers ‌resign. His ⁠defenestration seems to be a matter of when rather than if, said Robert Wood, chief UK economist at Pantheon Macroeconomics.

Investors were also worried that a potential successor to Starmer might advocate for increased spending, despite Britain’s already strained finances.

The likely ​replacements would probably not ​be as fiscally ⁠disciplined. A discretionary loosening in fiscal policy is on the way regardless of who is PM, said Ruth Gregory, deputy ​chief UK economist at Capital Economics.