LONDON: UK shares rose on Wednesday aided by strong earnings from Barclays and gains in consumer staples on the back of a weaker pound, while investors awaited Russia’s next move after Western sanctions were imposed on Moscow for ordering troops into separatist regions of eastern Ukraine.
The blue-chip FTSE 100 gained 0.1% with Barclays up 3.1%, being the top boost after the British lender reported that its annual profit nearly trebled as bad loan charges plunged and its investment bank continued its strong recent performance.
“Barclays is showing signs of a story that keeps getting repeated through the financial sector. The impact of the pandemic on the sector isn’t as severe as first feared,” said Susannah Streeter, senior investment analyst, Hargreaves Lansdown.
Western nations slapped new sanctions on Russia on Tuesday for ordering troops into separatist regions of eastern Ukraine and threatened to go further if Moscow launched an all-out invasion of Ukraine.
On the FTSE 100, consumer staples led gains with dollar earning companies Diageo, Unilever, British American Tobacco, Reckitt Benckiser all up between 0.2% and 1.3%, after Sterling edged down following Bank of England Governor Andrew Bailey’s statement.
Bailey said there were clear risks that inflation could again overshoot the central bank’s forecasts but markets should not get carried away about the likely scale of interest rate rises.
The domestically focused mid-cap index fell 0.7% recording its sixth straight session in losses, as travel and leisure stocks declined 1.4%.
Rio Tinto fell 2.2% as the global miner warned of U.S. sanctions on Russia potentially disrupting aluminium supply. Fashion retailer Ted Baker rose 9.8% on higher fourth-quarter sales even in the face of pandemic-related curbs, while Metro Bank gained 4.0%, on narrowing its annual losses.
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