Sept 17 (Askume) – The FTSE 100 hit a two-week high on Tuesday as bets rose on a sharp U.S. interest rate cut and domestic retail stocks strengthened after Kingfisher (KGF.L) upgraded its forecasts.
The blue-chip index FTSE 100 (.FTSE) rose 0.7%, reaching its highest level since Sept. 3.
All major industry indexes were in the green, with automotive (.FTNMX401010) and retail (.FTNMX404010) gaining 1.7% and 1.6%, respectively.
The mid-cap index (.FTMC) rose 0.2%.
European home improvement retailer Kingfisher (KGF.L) lifted the FTSE 100 after raising the bottom end of its full-year profit forecast , citing improving sales trends in seasonal categories.
With all eyes on the Federal Reserve’s expected first rate cut on Wednesday, traders have raised the chance of a deeper rate cut than the usual 50 basis points to 67% from Monday’s 50%, according to CME Group’s FedWatch tool.
The Bank of England also meets this week. Analysts generally expect policymakers to keep interest rates on hold, so investors will focus on clues about the Bank of England’s direction for the rest of the year and updates on the pace of bond issuance.
UK inflation data due on Wednesday will also be closely watched for further cues on the Bank of England’s interest rate path.
Among individual investors, gaming technology company Playtech (PTEC.L) gained 0.5 after it said it would sell its Italian unit Snaitech to Flutter Entertainment for 2.3 billion euros ($2.56 billion). (FLTRF.L)
Plastic and metal parts supplier Essentra (ESNT.L) warned that annual operating profit could be lower than market expectations due to weak economic conditions in Europe and a slow recovery in the US, sending its shares down 24%.
E-commerce company THG (THG.L) said it is actively seeking to facilitate the spin-off of its technology services unit , sending its shares down 2.3%.
(1 USD = 0.8990 EUR)
(This story has been rewritten in paragraph 1 to say Tuesday, not Monday)
