FTSE 100 rises on boost from consumer and financial stocks

  • FTSE 100 up 1.5% FTSE 250 gains 2.4%
  • Sterling appreciates, 10-year bond yields fall
  • Greggs same-store sales increase 9.7%

Oct 4 (Reuters) – British stocks rose on Tuesday, lifted by financials and retail stocks as weak U.S. data raised hopes the Federal Reserve could abandon its hawkish stance, while some calm in markets bonds also helped improve sentiment.

The export-oriented FTSE 100 (.FTSE) rose 1.5%, after hitting lows in March on Monday, while the more domestically-oriented FTSE 250 (.FTMC) recorded a three-day losing streak, jumping 2.4% at 0853 GMT.

US stocks rallied on Monday after weak manufacturing data hit Treasury yields and the dollar, spurring a global rally.

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“U.S. manufacturing numbers have been a little disappointing. So now there’s growing speculation that the Fed may be looking to pivot or at least suspend interest rate hikes. for a while,” said David Madden, market analyst at Equiti Capital.

Risky assets have taken a hit this year as central banks around the world undertake monetary tightening to rein in soaring inflation, at the risk of triggering a recession.

In London, stocks got off to a choppy start to the final quarter on Monday. A “mini-budget” last month proposed unfunded tax cuts, rattling markets globally. However, Finance Minister Kwasi Kwarteng has canceled the plan and is now expected to publish his medium-term budget plan later this month – earlier than expected. Read more

“The best gauge of sentiment is the pound now rather than stocks and its value is much better now,” Madden added.

The British pound rose 0.5%, while 10-year gilt yields also fell.

Legal & General Group (LGEN.L) jumped 5.1% after saying it would continue to support pension fund clients rocked by sudden interest rate hikes. She added that she had not encountered any difficulties in the aftermath of the “mini-budget”. Read more

Retailers (.FTNMX404010) were dragged higher by a 9.9% jump at Greggs (GRG.L) after its same-store sales rose 9.7% year-on-year , despite a worsening cost-of-living squeeze. Read more

Energy stocks (.FTNMX601010) gained 0.3%, supported by higher crude prices on the prospect of OPEC+ supply cuts.

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Reporting by Johann M Cherian in Bangalore; edited by Uttaresh.V

Our standards: The Thomson Reuters Trust Principles.

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