LONDON MARKETS: U.K. Stocks Halt 2-session Skid, But Gains Capped By Pound Rally
March 23 2017 - 1:50PM
Dow Jones News
By Sara Sjolin, MarketWatch
Investors are still digesting Wednesday's attack in London
U.K. stocks closed slightly higher on Thursday, underperforming
the broader European markets as a rally in the pound limited gains
after retail sales beat expectations.
Investors were also still digesting the attack in London on
Wednesday afternoon, which left at least four people dead and
dozens injured. Police is treating the incident as a terrorist
attack.
The FTSE 100 index ended 0.2% higher at 7,340.71, snapping a
two-day losing streak. That compared with a 0.9% jump in the
pan-European
(http://www.marketwatch.com/story/european-stocks-hover-at-week-lows-as-investors-eye-us-health-care-vote-2017-03-23)
Stoxx Europe 600 index , which was getting a boost from an upbeat
session in the U.S
(http://www.marketwatch.com/story/wall-street-stocks-lined-up-for-cautious-moves-ahead-of-yellen-speech-health-care-vote-2017-03-23).
ahead of a key vote on a health-care bill.
The underperformance came as the pound rose to an intraday high
of $1.2531 after U.K. retail sales for February rose 1.4%
(http://www.marketwatch.com/story/uk-retail-sales-surge-14-in-february-2017-03-23),
easily beating forecasts of 0.4%. Sterling traded at $1.2484 late
Wednesday in New York. A stronger pound tends to weigh on the many
FTSE 100 companies that make the bulk of their revenue overseas and
then transfer their profit back to the U.K.
"The risks to real household spending from rising inflation are
grossly overstated," said Kallum Pickering, senior U.K. economist
at Berenberg, in a response to the retail sales.
"The rise in inflation will squeeze household incomes in 2017
and 2018 even as tight labor market conditions cause a modest rise
in nominal wage growth. But it is unlikely to fully pass through
into real consumption growth," he added.
Shares of Reckitt Benckiser Group PLC (RB.LN) fell 1.3%,
Unilever PLC (ULVR.LN) (ULVR.LN) lost 0.2% and Hikma
Pharmaceuticals PLC (HIK.LN) gave up 2.2%.
In other movers, Next PLC (NXT.LN) jumped 8.1% after the fashion
retailer maintained its final dividend at GBP1.05 and confirmed its
guidance for the current year
(http://www.marketwatch.com/story/fashion-retailer-next-posts-drop-in-profit-2017-03-23).
Shares of Kingfisher PLC (KGF.LN) dropped 1.6%, building on a
5.1% slide from Wednesday when the home-improvement retailer
flagged concerns about the uncertainty for the U.K. economy in the
wake of the Brexit vote
(http://www.marketwatch.com/story/kingfisher-profit-rises-chairman-to-retire-2017-03-22).
London attack: Eight people have been arrested
(http://www.marketwatch.com/story/seven-arrested-in-six-raids-as-police-probe-london-terror-attack-2017-03-23)
as police continue to investigate the attack in London on
Wednesday.
An assailant on Wednesday afternoon mowed down pedestrians on
Westminster Bridge, before breaking through barriers and into
parameters of the Houses of Parliament. A police officer was
stabbed and later died of his injuries. Two members of the public
and the attacker have also been confirmed dead.
(END) Dow Jones Newswires
March 23, 2017 13:35 ET (17:35 GMT)
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