LONDON, June 16 — UK’s benchmark FTSE 100 climbed in a broad-based rally today, while a decline in top building materials supplier Travis Perkins following a profit warning capped the advance in the mid-cap 250 index.
The resource-heavy FTSE 100 was up 0.8 per cent at 0845 GMT. The export-oriented benchmark index was on track for a weekly gain after three straight weeks of losses, underpinned by miners and a weak sterling.
Miners have gained over 6 per cent this week tracking higher metal prices on a weaker dollar and bets of more stimulus measures in top consumer China.
Investors keenly await domestic inflation data and a 25-basis-point rate hike from the Bank of England next week following a similar-sized increase by the European Central Bank and a hawkish pause from the US Federal Reserve this week.
Analysts at Deutsche Bank expect the BoE’s monetary policy committee to focus on economic growth, stubborn price pressures, and wage growth in the June policy meeting.
“Inflation will continue to remain volatile and skewed to stronger prints in the near-term... and the labour market will also likely remain hot in the very near-term,” they added.
Meanwhile, investors also drew comfort from the Bank of Japan’s decision to maintain ultra-easy monetary policy and remain a dovish outlier among global central banks.
Energy and pharmaceuticals were the biggest boost to the FTSE 100.
Travel and leisure was the top sector gainer with an over 1 per cent advance, with Carnival PLC rising 3.1 per cent on a Citigroup price target upgrade.
Travis Perkins dropped 5.4 per cent, touching a seven-month low intraday, after the British company said its profit would be hit by challenges in the country’s housing market.
The FTSE 250 mid-cap index was up 0.4 per cent.
ASOS jumped 5.4 per cent, extending gains from the previous session on a return to profitability, with RBC raising its price target on the online fashion retailer. — Reuters
