Consumer staples, miners lift London's FTSE 100; Vodafone surges
Reuters
Published Jul 23, 2021 08:30
Updated Jul 23, 2021 17:01
By Shashank Nayar and Amal S
(Reuters) - The FTSE 100 index ended higher on Friday, led by gains in consumer staples and a jump in Vodafone (LON:VOD) shares on strong results, while Ultra Electronics surged on a takeover bid from aerospace manufacturer Cobham (LON:COB).
The blue-chip index ended 0.9% higher, with consumer staples and miners leading gains. The index inched 0.3% higher this week, rebounding from an initial dip as concerns around slowing global economic recovery and surging Delta variant of the coronavirus caused a sell-off.
"Towards the end of last week and on Monday, the market saw a three day sell off, and now we've recovered, that's all driven by a recovery in U.S markets and corporate earnings," said Keith Temperton, equity sales trader at Forte Securities.
Mobile operator Vodafone jumped 2.4% and was among the largest gainers on the FTSE 100 after it reported a better-than-expected 3.3% rise in first-quarter service revenue.
"We're about to go into the biggest earnings season next week and everyone is anticipating more solid earnings as some of the major names are reporting," Temperton added.
Aiding sentiment was a jump in British retail sales in June, which sent shares of retail stocks up by nearly 1.0%. (Graphic: Retailers outperform FTSE 100 since mid-July as easing lockdown spur demand, https://fingfx.thomsonreuters.com/gfx/mkt/zjvqkqeydvx/chart.png)
The FTSE 100 has gained 8.7% so far this year led by dovish central bank policies and government stimulus, but has underperformed its wider European and local mid-cap peers due to inflation concerns and rising coronavirus infections.
Dollar-earning consumer staples stocks, including Unilever (LON:ULVR), Reckitt Benckiser Group, British American Tobacco (LON:BATS) and Diageo (LON:DGE) Plc were among top gainers on weaker pound.
The domestically focussed mid-cap index rose 0.9% on strong earnings updates from insurer Beazley, while Ultra Electronics was the top gainer on Cobham's takeover offer.
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However, Britain's rapid economic bounce-back from the pandemic slowed sharply in July as a new wave of cases forced hundreds of thousands of workers to self-isolate under government rules to limit the spread of the disease.
Among other stocks, Britain's NatWest Group rose 2.5% after it agreed to sell assets from its Irish arm to Permanent TSB.
Written By: Reuters
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