MARKET REPORT: FTSE 100 soars to a 5-year high on the back of US hopes: blue chip index posts fourth day of gains to hit 7699.49
The FTSE 100 reached its highest level for almost five years in a spectacular start to 2023.
In a fourth day of gains since trading resumed after the New Year holidays, London’s blue-chip index rose 0.9 percent, or 66.04 points, to 7,699.49. That is the highest level since August 2018.
The rally was reflected in the more domestically focused FTSE 250, which added 0.2 percent, or 41.29 points, to 19,504.72.
On a roll: The FTSE 100 reached its highest level in almost five years in a spectacular start to 2023
Both benchmarks have posted four days of gains since trading resumed after the New Year.
AJ Bell’s chief investment officer, Russ Mold, said: “As the New Year begins, 2023 looks lively for the FTSE100 with the index rising every session so far.”
“Small steps forward are a success given the difficult context.” Sentiment was boosted by new US economic data.
US employers hired another 223,000 new positions, while the unemployment rate fell to 3.5 percent from 3.6 percent.
But perhaps of great importance to investors was the slower growth in wages that could eventually persuade the US Federal Reserve.
Shares of the Clarkson shipping group rose after reporting an upbeat end to the year.
The FTSE250 firm singled out its brokerage division, which links boat owners with clients looking to charter boats, as it praised “solid trading” through Q4 2022.
The group said it expects full-year earnings to be “above current market expectations” by “not less than £98m”.
That would be well above the £69.4m generated in 2021 and Peel Hunt analyst forecasts of £83.6m. Shares in the company, which has 52 offices in 23 countries, rose 5.1 percent, or 160p, to 3,305p. However, Peel Hunt cautioned that Clarkson faces a tougher spell this year due to the weak dry bulk market.
Mike Ashley’s Frasers Group reduced its stake in Hugo Boss to 3.9 percent just two months after increasing its stake to 4.3 percent. It controls another 25 percent of Hugo Boss through derivatives.
The fashion empire, which owns Sports Direct, Jack Wills and Flannels, said its maximum exposure in the luxury German designer brand is around £580m, up from £840m. Frasers shares fell 0.4 percent, or 3 pence, to 758 pence.
Pest control firm Rentokil Initial fell 3.7 percent, or 19 pence, to 501.4 pence after city broker BNP Paribas started its coverage with an “underperforming” rating.
Essentra, the mid-cap components business, fell 6.8 per cent, or 16 pence, to 218 pence after a difficult end to 2022.
The group said sales for the final three months of last year were 3 percent lower than the same period in 2021. That meant revenue for 2022 was likely up 6.5 percent.
But Jefferies analysts warned that the downturn seen late last year is expected to continue until the end of 2023.
Topps Tiles has accused one of its biggest investors of misleading other shareholders in a board battle. MS Galleon owns about 30 percent of the tile retailer and has called for the departure of Darren Shapland, the company’s president, and the appointment of two other board members.
But Topps said MS shared information with shareholders “that contradicts previous statements made directly to Topps.” There will be a vote on January 18.
Shares were flat at 48 pence.
Curtis Banks Group has agreed terms of acquisition with digital investment platform provider Nucleus.
The 350p-per-share offer values the self-invested personal pension provider at around £242m.
Curtis Banks shares rose 2.7 percent, or 9 pence, to 342 pence.