U.K. stocks closed higher on Tuesday after a mixed jobs report that was seen as easing pressure on the Bank of England to raise interest rates. Shares of Vodafone added pressure on the London benchmark after news the CEO is leaving. The FTSE 100 index ended 0.2% higher at 7,722.98, logging its highest close since Friday. The pound traded at $1.3509, compared with $1.3556 late Monday in New York. Sterling has lost more than 5% against the dollar over the past month as expectations of an imminent rate increase dwindled following dovish comments from BOE Gov. Mark Carney and a string of disappointing data. A weaker pound tends to boost the FTSE 100 as the index’s components make the bulk of their earnings overseas, with a softening sterling lifting revenues when converted back into the U.K. currency. The pound drop was also a function of a rally inthe dollar, which came after upbeat U.S. retail sales data were seen as highlighting the economy’s steady momentum. All eyes were on the U.K. jobs data. The unemployment rate remained at a 42-year low of 4.2% in March, while wages without bonuses advanced 2.9%, up from 2.8% in February. However, earnings including bonuses slipped to 2.6% from 2.8%.
Carney said last week at the central bank’s quarterly inflation report news conference that interest rates will rise over the next three years, if the economy evolves as the bank forecasts. The comments were seen as adding extra weight to the macroeconomic data coming out of the U.K. Shares of Vodafone Group dropped 4.3% after the telecom giant said its chief executive Vittorio Colaowill step down and be succeeded by Chief Financial Officer Nick Read, effective Oct. 1. EasyJet rose 3.3% after the budget airline said its
pretaxloss for the first half of fiscal 2018 narrowed, driven by record revenue a reduction in capacity by other airlines. House builders were on the rise after Taylor Wimpey said it plans to declare a special dividend for 2019 of £350 million pounds ($475.1 million). That will increase total dividends for the year by 20%. Shares of Taylor Wimpey rose 3.7%, Berkeley Group Holdings climbed 1.5% and Persimmon rose 1.8%. Outside the FTSE 100, shares of CYBG slid 5.6% after the bank reported disappointing earnings and said the U.K. environment remains challenging.
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