FTSE closes at 6198.1

The FTSE 100 Index has closed 6.5 points higher at 6198.1.

London's blue chips gave back early gains as soaring oil prices and a blow to interest rate cut hopes rattled investor nerves.

Oil firms dominated the risers' board, with BG Group leading the way. It was more than 5 per cent better off, or 72p at 1394p thanks to the soaring oil prices. Royal Dutch Shell added 100p at 2212p, and BP lifted 21.75p to 649.75p.

Big-hitting miners were also on much better ground after suffering in the wake of a sector downgrade. Vedanta Resources closed up 75p to 2712p and BHP Billiton ended the day 43p ahead at 2066p.

But it was a bad day for retailers and banks as investors digested the latest Bank of England minutes, which showed little appetite for further interest rate cuts due to inflation risks.

The Bank revealed it was more concerned with getting inflation back to 2 per cent than boosting economic growth as members voted eight to one to keep borrowing costs steady this month.

The sentiment saw retailers like Argos owner Home Retail Group shed 16.25p to 232.75p, with Sainsbury's off 15.5p to 340p. B&Q owner Kingfisher was 5p down at 134.9p.

Banks hoping for cheaper mortgages were also knocked back. Royal Bank of Scotland slipped 12.5p to 241.5p, and Halifax Bank of Scotland 19.75p to 445.5p. Barclays was also down, losing 7.5p at 398p.

Lambert & Butler maker Imperial Tobacco was the FTSE's leading casualty, following a downgrade from JP Morgan after Tuesday's bigger than expected £4.9 billion rights issue. The stock was down almost 11 per cent or 268p to 2187p.

Winners: BG Group up 72p to 1394p, Shell up 100p at 2212p, Cairn Energy up 162p at 3681p and John Wood Group, which closed up 20.25p at 474.25p.

Losers: Imperial Tobacco, down 268p at 2187p, Home Retail Group down 16.25p at 232.75p, Alliance & Leicester down 19.25p at 415.25p and Sainsbury's, which ended the day 15.5p down at 340p.

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