The FTSE 100 made a solid start to the week underpinned by renewed gains for oil off the back of attacks on facilities in Saudi Arabia over the weekend, says AJ Bell investment director Russ Mould.
“This lifted index heavyweights BP and Royal Dutch Shell as the black stuff traded above $70 per barrel for the first time since January 2020 when tensions between Iran and the US were rapidly escalating.
“The only problem is the rise in oil will only add to the key concern which is dogging markets – namely the risk of runaway inflation and a resulting increase in interest rates.
“The other key driver for positive sentiment this morning is also a double-edged sword with the news that the US has signed off its long-awaited $1.9 trillion stimulus package. This is also seen as a major catalyst for rising prices.”