ITV, defensives propel FTSE higher
Reuters
Published Jul 26, 2017 10:30
Updated Jul 26, 2017 10:40
ITV, defensives propel FTSE higher
By Kit Rees
LONDON (Reuters) - Strong updates from ITV and Compass Group helped Britain's top share index advance on Wednesday, underpinned also by gains among defensive stocks and mining shares.
Britain's blue chip FTSE 100 (FTSE) index was up 0.6 percent at 7,477.99 points by 0905 GMT.
The index extended gains slightly after sterling fell following UK GDP figures, which showed that economic growth edged higher in the second quarter, helped by the services sector and film industry.
Company earnings were front and centre of the market action as shares in ITV (L:ITV) jumped 2.8 percent after the broadcaster reported first half earnings, adding it expected advertising pressure to ease in the third quarter.
ITV's shares have been hit this year on concerns around a slowdown in advertising revenues, with the stock down around 10.6 percent so far in 2017.
"The broadcaster revenues were also lower but the results were in line with forecasts and the guidance for the year remains unchanged," Russ Mould, investment director at AJ Bell, said.
"The 5 percent increase in the interim dividend demonstrated the board’s confidence in the underlying strength of the business."
Results also buoyed shares in catering firm Compass Group (L:CPG), which rose 1.8 percent after reporting a 3.9 percent rise in quarterly revenue thanks to strength in its U.S. market.
Consumer stocks were among the top risers, with British American Tobacco (L:BATS), AB Foods (L:ABF) and Diageo (L:DGE) all helping underpin gains.
"Consumer goods and consumer services are sectors that have gained the most on the FTSE 100, as traders have confidence British consumers are willing to go out and spend money," David Madden, market analyst at CMC Markets UK, said in a note.
A disappointing update and downgrade to "neutral" from "outperform" from Credit Suisse (SIX:CSGN) weighed on Sage Group's (L:SGE) shares, which fell around 3.4 percent to the bottom of the blue chip index.
Likewise engineering firm (L:GKN) dropped 1.1 percent following its half year results.
Banking stocks were weak ahead of a decision on interest rate policy by the U.S. Federal Reserve later in the day, which was expected to keep rates unchanged.
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Updates were also in focus among mid caps (FTMC) which advanced 0.5 percent. Metro Bank (L:MTRO) shares were boosted nearly 3.3 percent after its second quarter figures, while a downgrade hit shares in troubled gold miner Acacia Mining (L:ACAA), which dropped 5 percent.
Written By: Reuters
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