Strong earnings forecasts, miners lift FTSE 100 to near 3-week highs

Ferguson jumps on strong full-year forecast

  
Dealers work at their desks whilst screens show market data following a vote on Prime Minister Theresa May's Brexit 'plan B' at CMC Markets in London, Britain, January 30, 2019.

Dealers work at their desks whilst screens show market data following a vote on Prime Minister Theresa May's Brexit 'plan B' at CMC Markets in London, Britain, January 30, 2019.

REUTERS/Dylan Martinez

UK's FTSE 100 rose to near three-week highs on Tuesday, boosted by mining stocks and positive earnings outlooks, with global markets taking relief from receding concerns about the Omicron variant of the coronavirus.

The FTSE 100 added 1.2% in morning trade. Plumbing parts distributor Ferguson advanced 4.4% to the top of the index after a strong revenue growth forecast. 

Rental equipment provider Ashtead Group PLC rose 2.7% after raising dividend and saying it expects full-year results ahead of previous estimates. 

"Ferguson spun-off its UK-based operation Wolseley, so it's now just a U.S.-based company, and Ashtead also has a very big presence in the U.S.," said Michael Hewson, chief markets analyst at CMC Markets.

"They're essentially leveraging a decent recovery in the U.S. economy and that's why they are posting decent gains."

Base metal miners  led gains on the commodity-heavy FTSE 100 as copper prices were boosted by monetary policy easing in top consumer China. 

The FTSE 100 has rebounded to levels touched before the detection of the Omicron variant in late-November after experts said the new strain might not be as severe as feared.

The domestically focussed mid-cap index advanced 1.0%, with travel and leisure stocks recovering 1.5% after getting hammered recently on fears of tighter travel restrictions.

British American Tobacco gained 1.9% after reiterating its full-year profit and sales forecasts, as more people switched to its Vuse vaping and Velo oral nicotine products.

Heavyweight drugmaker AstraZeneca declined 1.5% after brokerage Jefferies downgraded the stock saying its earnings per share is set to decline to single-digit growth beyond 2026.

(Reporting by Bansari Mayur Kamdar in Bengaluru; Editing by Subhranshu Sahu and Uttaresh.V) ((BansariMayur.Kamdar@thomsonreuters.com;))


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