© Reuters. FILE PHOTO: The London Stock Exchange offices in the City of London, Britain
By Devik Jain
(Reuters) -London’s climbed on Wednesday, boosted by a series of positive earnings updates from companies, including Lloyds Banking Group (LON:) and WPP (LON:), while investors awaited the outcome of the U.S. Federal Reserve’s policy meeting.
The blue-chip index rose 0.4%, with Lloyds Banking Group jumping 3.4% to the top of the index after Britain’s biggest domestic bank reported upbeat profit for the first three months of the year.
The wider banking index also added 1%, with Barclays (LON:) and Natwest Group among the biggest gainers ahead of their earnings reports this week.
WPP gained 2.8% after the world’s biggest advertising company said its underlying net sales returned to growth ahead of target as clients started to spend to prepare for the global economic recovery.
“The economy did much better than I expected and this is also being reflected in earnings. It shows that consumers and businesses have clearly found the race around the economic restrictions,” said Stefan Koopman, a senior market economist at Rabobank.
“There’s quite some savings that could be spent this year … and could set the economic recovery in motion. So, that’s good news for UK companies clearly.”
Earlier this week, Goldman Sachs (NYSE:) said it expects Britain’s economy to grow by a “striking” 7.8% this year, faster than the United States.
The FTSE 100 has gained 7.8% year-to-date on optimism that speedy COVID-19 vaccinations and constant policy support from the government would drive a stronger economic recovery.
The domestically focussed mid-cap advanced 0.5%.
Among other stocks, homebuilder Persimmon (LON:) added 2.4% after saying it expects first-half volumes to return to 2019 levels as the sector benefits from government support measures and low interest rates.
The wider homebuilders index also rose 2%.
Investors’ focus has now turned towards the U.S. central bank, which is expected to reaffirm its accommodative monetary policy stance at the end of its two-day meeting and dismiss any suggestions of tapering bond purchases.
Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.