The UK’s top share index rose yesterday as a rise in bond yields lifted financials and an appetite for risk returned.

The FTSE 100 ended the session up 0.4% at 7,398.87 points, the highest level seen in seven weeks, pulling into positive territory following a muted start to the day’s trading.

An increase in bond yields helped boost shares in financial stocks, as US treasury headed towards the 3% mark, while shares in HSBC, Lloyds and Barclays were all up between 0.4% and 1.1%.

CMC Markets UK chief market analyst Michael Hewson said: “Banking stocks have managed to record a fairly decent day helped by rising bond yields across the board.”

Shares in big, “bond proxy” stocks took a hit from the rise in yields, which make their dividends streams less attractive for investors.

Consumer goods producer Reckitt Benckiser was among the worst performers, down 2% as JP Morgan cut its rating for the stock, after it had published disappointing results last week.

Shares in BP and Royal Dutch Shell gained 0.7% and 0.9% respectively, shaking off a decline in the price of oil which remained close to its highest levels since the end of 2014.

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