UK's FTSE 100 hits record peak on weaker pound; Associated British Foods surges (updated)
23/04/2024 09:39
(For a Reuters live blog on U.S., UK and European stock
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Associated British Foods jumps after forecasting growth
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JD Sports Fashion to buy U.S. rival Hibbett; shares up
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FTSE 100, FTSE 250 both up 0.5%
(Updated at 0826 GMT)
By Pranav Kashyap and Sruthi Shankar
April 23 (Reuters) - The UK's blue-chip share index
cruised to record highs on Tuesday, helped by a weaker pound and
positive corporate updates, while investors focussed on earnings
from U.S. tech giants this week.
The blue-chip FTSE 100 .FTSE gained 0.5% to 8,059.39
points, surpassing its previous peak of 8,047.06 points hit in
February 2023.
Surging commodity prices, a falling pound as well as gains
in defence stocks have powered the FTSE 100 higher this year as
investors took advantage of cheaper valuations in British
equities compared to other global markets.
"It's predominantly down to the weakness of the pound
against the dollar in the past week," Russ Mould, investment
director at AJ Bell said.
"It's obviously taken a long time to get to its all-time
high compared to other markets. The FTSE 100 has underperformed
for a very long time and when markets underperform it can mean
undervalued."
The pound GBP=D3 steadied after touching its lowest in
over five-months on Monday as traders priced in early interest
rate cuts from the Bank of England. When the value of the pound
decreases, it often benefits stocks in the FTSE 100 index as
most of their earnings come from overseas.
Investors will closely watch earnings from U.S. tech firms
as well as inflation data to gauge if there is room for further
market gains.
Associated British Foods ABF.L jumped 9.4% to the top of
the FTSE 100 after the Primark owner forecast "significant
growth" in full-year profit as it reported a 39% jump in the
first half.
Other retailers such as J Sainsbury SBRY.L and Tesco
TSCO.L rose more than 1% each, while Ocado OCDO.L added 5%
after data showed UK grocery price inflation fell for the 14th
month in a row in April, partly driven by an increase in
supermarkets' promotional activity.
JD Sports Fashion JD.L jumped 7.1% after the sportswear
retailer proposed to buy U.S. athletic-fashion retailer Hibbett
Inc HIBB.O for about $1.08 billion.
The mid-cap FTSE 250 .FTMC was up 0.5%, hovering near the
20,000 mark.
Petershill Partners PHLL.L gained 5.8% after the
investment firm proposed a tender offer to return up to $100
million to shareholders at a price per share of 2.14 pounds.
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FTSE 100 hits record high but lags European, U.S. peers https://tmsnrt.rs/3vTbrCQ
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(Reporting by Pranav Kashyap and Sruthi Shankar in Bengaluru;
Editing by Mrigank Dhaniwala)
((Pranav.Kashyap@thomsonreuters.com;))
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