Financials and miners drive FTSE higher

The FTSE has extended early gains after figures showed inflation eased in July, with financials and mining stocks leading the charge into positive territory.

Shortly after midday, London's blue-chip index was up nearly a percentage point to 5,324.

Insurers are performing strongly on the back of consolidation vehicle Resolution posting a £203m first half profit. Aviva - which recently rejected a bid from RSA for its general insurance operations - is up over 3% and Prudential is also edging near 3% gains.

Mining stocks are among the day's top performers following broker predictions of stronger demand from China and strong metal prices. Kazakhmys and Eurasian Natural Resources both rose around 3%.

The sector has also been buoyed by the announcement yesterday Vedanta Resources will acquire a 60% stake of Cairn India. Cairn is down over 1% following the announcement.

Earlier in the day, figures released from the Office for National Statistics showed inflation slowed in July to 3.1%. The figures eased concerns the Bank of England will raise interest rates, making equities more attractive.