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* FTSE 100 up 0.7 pct
* Cyclicals lead gains
* Upgrade supports Barrat
By Kit Rees
LONDON, June 1 (Reuters) - Britain’s top share index rose on Friday as shares in cyclical stocks such as miners and financials rallied, joining in broader gains for European stocks as relief over Italy’s political crisis lifted risky assets.
The blue chip FTSE 100 index gained 0.7 percent, while mid caps also advanced 0.6 percent.
The end of May was marred by turmoil in Italian politics, which appeared to have found a resolution after the country’s anti-establishment parties revived a coalition deal, removing the risk of a new election.
British blue chips managed to escape the wider market sell-off relatively unscathed, posting a gain of 2.2 percent in May, the best-performing European market thanks to its heavy weighting in large, international stocks such as miners and oil majors.
On the day, a rise in shares of banks Barclays, HSBC and Lloyds saw financials contribute the biggest boost to the FTSE. Banking stocks have been caught up in a broad sector sell-off led by Italian lenders.
Mining stocks were also higher, with shares in Glencore , Rio Tinto and Anglo American up 1.7 percent to 3 percent, while oil majors BP and Royal Dutch Shell gained 0.4 percent and 1 percent respectively as crude oil prices clawed back losses.
Housebuilder Barratt Developments was supported by an upgrade to “overweight” from JPMorgan, sending its shares 2.9 percent higher, with JPM’s analysts saying that differences in earnings momentum between the large cap housebuilders have resulted in a divergence in stock price performance.
“Barratt has underperformed heavily over the last year, on earnings risk concerns that we think will prove unfounded – if anything, we see upside risk to FY19 estimates,” said JPMorgan’s analysts in a note.
Data showing growth among UK manufacturers picked up speed in May had little impact. The improvement however masked underlying weakness among the country’s factories. (Reporting by Kit Rees and Danilo Masoni Editing by Alison Williams)