Investing
UK stocks close higher on AstraZeneca, mining boost
Global Banking and Finance Review
Company
By Shashank Nayar and Sruthi Shankar
(Reuters) -Britain’s blue-chip index closed higher on Thursday, boosted by AstraZeneca’s gains following an upbeat sales forecast, while strong metal prices lifted mining stocks to their highest in more than a decade.
The FTSE 100 index rose 0.4% and the gauge of industrial miners’ performance hit its highest since August 2011, buoyed by soaring prices of aluminium, copper and other base metals. [MET/L]
AstraZeneca jumped 3.4% after the drugmaker raised its annual dividend for the first time in a decade and forecast higher sales for 2022, with new drugs against cancer, kidney disease and rare conditions making up for a decline in COVID-19 products.
Unilever, however, slipped 1.3% after the consumer products maker warned its profit may suffer this year as it struggles to offset soaring costs with higher prices.
“Profit margins are under pressure which is a big worry,” said Russ Mould, investment director at AJ Bell. “Unilever’s brands are meant to be world-class, so if a company with its assets cannot defend margins, something is very wrong.”
Overall, broadly positive earnings helped investors look past stronger-than-expected U.S. inflation data that spurred bets on an aggressive move by the Federal Reserve. The FTSE fell 0.3% following the release of the data but recovered as the session ended.
UK shares have consistently been outperforming markets in the United States and the rest of Europe this year. Expectations of higher interest rates have lifted heavyweight banking stocks and rising oil prices have bolstered the commodity-heavy index.
The domestically focused mid-cap index added 0.1%, buoyed by travel and leisure stocks.
British insurer Beazley Plc climbed 2.1% after it resumed its dividend following an annual profit.
Homebuilders gained 0.5% after a survey showed domestic house prices rising at their fastest in six months in January.
Data analytics firm Relx slipped 1.9% as analysts said it slightly missed its 2021 operating profit forecast.
(Editing by Rashmi Aich, Tomasz Janowski and Mark Heinrich)
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