FTSE 100 gains for fourth day as pound weakens after labour report (updated)

WestRock Co

12/09/2023 10:05

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      FTSE 100 gains, helped by weaker pound
    

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      Smurfit Kappa plunges on WestRock deal
    

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      AB Foods tops FTSE 100 on upbeat profit outlook
    

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      FTSE 100 up 0.4%, FTSE 250 adds 0.1%
    

  
 (Updated at 1550 GMT)
    By Siddarth S and Shreyashi Sanyal
       Sept 12 (Reuters) - London's FTSE 100 rose on Tuesday as
the pound fell after data showed Britain's labour market
weakened in July, even as wage growth stayed strong, while a
plunge in Smurfit Kappa's shares capped gains.
    The exporter-heavy FTSE 100 index  .FTSE  closed up 0.4%,
gaining for the fourth straight day amid the weaker pound
 GBP=D3 . Mid-cap stocks  .FTMC  rose 0.1%.  
    Data showed Britain's unemployment rate ticked up to 4.3% in
the three months to July, from 4.2% in June. However, average
weekly earnings growth climbed to 8.5% in annual terms, up from
8.4% a month earlier and marking a new high, excluding
distortions during the COVID-19 pandemic, in records dating back
more than 20 years.  
    "Wage growth is still hot in Britain and the temperature
isn't coming down much," said Susannah Streeter, head of money
and markets at Hargreaves Lansdown, "providing little relief for
Bank of England policymakers who need more evidence that
employers are showing restraint before they'll feel confident
about pressing pause on interest rate hikes."     
    Most investors think the Bank of England (BoE) will raise
interest rates again on Sept. 22 to 5.5% from 5.25%, perhaps for
the last time in the current cycle.
    Traders see a 78% chance of the BoE lifting rates by 25
basis points at its September meeting.  0#BOEWATCH 
    Focus will shift to UK July GDP data and U.S. consumer price
numbers on Wednesday. 
    Associated British Foods shares  ABF.L  rose 5.3% to the top
of the benchmark index after the Primark owner raised its
full-year profit outlook for the second time in four months.
    AstraZeneca  AZN.L  bounced 1.7% after falling more than 4%
in the previous session, as the drugmaker appeared to play down
speculation about its CEO's future.
    Europe's largest paper and packaging producer Smurfit Kappa
 SKG.I  said it would buy U.S. rival WestRock  WRK.N  for an
agreed $11 billion to create the world's largest listed paper
and packaging company. 
    London-listed shares of Smurfit Kappa  SKG.L  slumped 9.8%
as some analysts said the company was paying a hefty premium. 

 (Reporting by Siddarth S and Shreyashi Sanyal in Bengaluru;
Editing by Janane Venkatraman and Mark Potter)
 ((Shreyashi.Sanyal@thomsonreuters.com; Twitter: https://twitter.com/s_shreyashi;))
 
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