UK stocks rise on upbeat retail sales data, Rio Tinto boost
Reuters
Published May 26, 2023 08:22
Updated May 26, 2023 09:56
By Johann M Cherian
(Reuters) -UK stocks gained on Friday after data showed retail sales unexpectedly rose in April, highlighting resilience in consumer spending despite elevated inflation, while miner Rio Tinto (LON:RIO) posted its best day in more than a month on a brokerage upgrade.
Retail sales volumes rose 0.5% in April after a 1.2% fall in March, as per an official report. Sales volumes over the three months to April grew by the most since mid-2021.
The pound added 0.2% after the data.
"While the outlook for retail sales appears to be improving, we expect further rises in interest rates, from 4.50% now to a peak of 5.25%," said Ashley Webb, UK economist at Capital Economics.
"That will mean real consumer spending is more likely to decline later this year than rise."
The blue-chip FTSE 100 rose 0.2%, boosted by a 3.8% jump in Rio Tinto after Morgan Stanley (NYSE:MS) turned bullish on the stock.
The broader industrial metals mining sector also climbed 3.1%.
AstraZeneca (NASDAQ:AZN) Plc added 0.7% after the drugmaker said a combination of its cancer drugs when added to chemotherapy showed positive results in a late-stage trial in patients with advanced or recurrent endometrial cancer.
The FTSE 250 shed 0.2% by 0827 GMT.
Both the FTSE indexes are set for weekly declines of more than 2% each, their worst weekly drop in over a month.
Disappointing domestic inflation data and U.S. debt deal uncertainties dominated investor sentiment this week, said Christopher Peters, trading floor manager at Accendo Markets.
ASOS (LON:ASOS) Plc reversed gains and was down 0.5%, after the fashion retailer announcing planned to boost its balance sheet.
Tech firm Kin & Carta PLC tumbled 8.3% on slashing annual revenue expectations.
XLMedia PLC slumped 17.8% on lower annual sales expectations.
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Written By: Reuters
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