Strong earnings forecasts, miners lift FTSE 100 to near 3-week highs

© Reuters. FILE PHOTO: Pedestrians leave and enter the London Stock Exchange in London, Britain August 15, 2017. REUTERS/Neil Hall/File Photo

By Bansari Mayur Kamdar

(Reuters) -UK’s rose to near three-week highs on Tuesday, boosted by mining stocks and positive earnings outlooks, with global markets taking relief from receding concerns about the Omicron variant of the coronavirus.

The FTSE 100 added 1.2% in morning trade. Plumbing parts distributor Ferguson advanced 4.4% to the top of the index after a strong revenue growth forecast.

Rental equipment provider Ashtead Group (LON:) PLC rose 2.7% after raising dividend and saying it expects full-year results ahead of previous estimates.

“Ferguson spun-off its UK-based operation Wolseley (LON:), so it’s now just a U.S.-based company, and Ashtead also has a very big presence in the U.S.,” said Michael Hewson, chief markets analyst at CMC Markets.

“They’re essentially leveraging a decent recovery in the U.S. economy and that’s why they are posting decent gains.”

Base metal miners led gains on the commodity-heavy FTSE 100 as prices were boosted by monetary policy easing in top consumer China. [MET/L]

The FTSE 100 has rebounded to levels touched before the detection of the Omicron variant in late-November after experts said the new strain might not be as severe as feared.

The domestically focussed mid-cap index advanced 1.0%, with travel and leisure stocks recovering 1.5% after getting hammered recently on fears of tighter travel restrictions.

British American Tobacco (LON:) gained 1.9% after reiterating its full-year profit and sales forecasts, as more people switched to its Vuse vaping and Velo oral nicotine products.

Heavyweight drugmaker AstraZeneca (NASDAQ:) declined 1.5% after brokerage Jefferies downgraded the stock saying its earnings per share is set to decline to single-digit growth beyond 2026.

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