Shares in Barclays raced ahead as boss Jes Staley said he is confident the bank is on the right track regardless of the Brexit vote.

The banking giant was the biggest riser on the London market despite pre-tax profits tumbling 21% to £2.06 billion in the first half of the year.

Shares in the lender rose more than 5%, or 8.1p, to 154.6p, helping the London market step up 3.4 points to 6724.43.

Mr Staley said the picture in the second quarter was "strong" and showed "very encouraging progress" against the lender's existing strategy.

He added: "We remain confident that it is the right plan for Barclays, and see no reason to adjust it, or the pace of delivery, in light of the vote by the UK last month to exit the EU."

However, the bank was also quick to point out where the Brexit vote could harm business.

It said the increased risk of recession with lower growth, higher unemployment and falling UK house prices "would likely negatively impact a number of Barclays' portfolios", most notably its mortgage offering.

It added that if Brexit negotiations end with the UK's financial sector losing "passporting" rights, it would require the bank to make "alternative licensing arrangements in EU jurisdictions" where it operates.

Shares in Lloyds Banking Group were also ahead, rising 0.7p to 53.2p, while Royal Bank of Scotland climbed 4.4p to 192.4p.

On the currency markets, the pound surged 0.7% against the dollar at 1.326 US dollars after the American economy churned out a lacklustre performance in the second quarter.

The US Department of Commerce said gross domestic product (GDP) came in at a lower-than-expected rise of 1.2% in the three months to June, with market analysts having pencilled in growth of 2.6%.

Sterling was 0.1% down against the euro at 1.186 euro.

Across Europe, Germany's Dax was up 0.6% and the Cac 40 in France rose 0.4%.

In stocks, drinks giant SABMiller rose 2% or 90p to 4414p after its board backed an improved takeover offer from Budweiser brewer Anheuser-Busch InBev.

The board has recommended shareholders accept an offer of £45 a share, up from its earlier offer of £44, valuing SABMiller at about £79 billion.

The announcement comes after AB InBev cleared another major hurdle in its pursuit of the London-listed drinks firm after winning regulatory backing in China.

British Airways-owner IAG was in the red after the group said it was poised to cut capacity and review investments.

Chief executive Willie Walsh said: "Our performance this quarter saw a negative currency impact of 148 million euro (£124.4 million), primarily due to the weak pound.

"Numerous external factors affected our airlines, including the impact of terrorism, uncertainty around the UK's EU referendum and Spain's political situation."

Shares were off 3.3p to 406p.

Away from the top tier, Foxtons saw its shares nosedive after profits tumbled 42% in the first half of the year as the impact of Britain's decision to quit the European Union hit the London property market.

Shares dropped more than 11%, or 14p, to 110p as the estate agent said pre-tax profits slumped from £18.1 million to £10.5 million during the period.

Chief executive Nic Budden said: "The result of the referendum to leave Europe is likely to lead to a prolonged period of further uncertainty and we do not expect London residential property sales markets to show signs of recovery before the end of the year."

The biggest risers on the FTSE 100 Index were Barclays up 8.1p to 154.6p, Standard Life up 10.7p to 302.9p, Paddy Power Betfair up 305p to 8800p, Schroders up 87p to 2618p.

The biggest fallers were Pearson down 88p to 882p, Rolls-Royce down 40p to 791p, Royal Dutch Shell B down 49.5p to 2002p, Informa down 15.5p to 714p.