U.K. stocks rose for a second session on Tuesday, boosted a rally in shares of Smurfit Kappa and Intertek Group, as fears that U.S. tariffs could spark a global trade war abated.
Tesco’s shares advanced after encouraging sales data showed the supermarket chain continues to prosper, having seen particularly strong growth at its Extra outlets. The FTSE
100 climbed 0.4% to close at 7,146.75, adding to a 0.7% rise from Monday, when the London benchmark rebounded from a 14-month low.
The pound rose to $1.3884 from $1.3846 late Monday in New York. Stocks in the U.K. climbed as part of a broader European rally, which came as traders returned to embracing riskier assets as fears over a global trade war eased. Those concerns were sparked by U.S. President Donald Trump’s announcement last week that he would impose tariffs on steel and aluminumimports. But on Monday, Republican leaders, including House Speaker Paul Ryan, warned that the tariffs could jeopardize U.S. economic growth and began
lobbying for the president to reconsider the move. “We are extremely worried about the consequences of a trade war and are urging the White House to not advance with this plan,” Ryan spokeswoman AshLeeStrong said.
There is also relief among investors that other major economies, such as China, have yet to retaliate, analysts said. However, the European Union intends to slap a 25% tariff on some U.S. goods, if the tariffs come into being, according to a media reports. Sentiment in Europe was further lifted by news that North Korea is willing to discuss scrapping its nuclear program and will meet for a summit with the South in April. Closer to home, the FTSE was lifted by individual stocks making big moves in Tuesday’s trade. Shares of Smurfit Kappa Group PLC topped the list of gainers, up 20%, after the packaging company rebuffed an offer proposal from International Paper Co. Intertek Group climbed 4.6% after the product testing and certification company said 2017 pretaxprofit rose 13%. Shares of Tesco put on 3.4% and Wm. Morrison Supermarkets PLC added 0.1%. The moves came after a survey from Kantar Worldpanelshowed the two supermarkets chains were the fastest-growing grocers in the U.K. over the last 12 weeks.
On a downbeat note, shares of Just Eat PLC slumped 13% after the takeaway company swung to a pretaxloss in 2017. It announced extra investment to boost its delivery services. Aggreko PLC slumped 4% after the power supplier said pretaxprofit declined in 2017. Ashtead Group PLC lost 5.5%. The industrial equipment rental company posted an increase in third-quarter profit, but also said finance director Suzanne Wood is to step down from her role on March 31.
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