Melrose Lifts FTSE 100 Ahead of Sunak Spending Announcement

Londons FTSE 100 rose on Wednesday, buoyed by Melrose Industries after it gave an upbeat trading update, with investors awaiting Britains oneyear spending plan announcement later in the day.

The bluechip index edged 0.1 higher, with turnaround specialist Melrose Industries Plc jumping 3.6 after saying it is currently trading at the top end of the boards expectations for 2020.

A slightly weaker pound also boosted shares of big dollarearning consumer staple companies such as British American Tobacco Plc, Diageo Plc and Unilever Plc.

Diageo Plc also rose after Credit Suisse upgraded the stocks rating to outperform and raised its target price.

Finance minister Rishi Sunak is set to announce extra investment to ease a backlog in the health system, counter a surge in unemployment and build new infrastructure in a Spending Review due to parliament around 1230 GMT.

This is just a oneyear review for 202122, but it will be interesting to see what the longterm fiscal picture looks like as well as the extent of tightening pencilled in for the year ahead, Deutsche Bank Strategist Jim Reid said in a note.

Britains budget deficit is set to reach around 20 of the GDP and its economy is on course for a record crash this year, but the FTSE 100 index rallied more than 15 this month on hopes of a speedy economic recovery based on positive vaccines data.

The domestically focused midcap FTSE 250 index, considered a barometer for Brexit sentiment, fell 0.5 after the European Commissions…

What's your reaction?

In Love
Not Sure

You may also like

Leave a reply

Your email address will not be published. Required fields are marked *

More in:News