Britain’s FTSE 100 seemed set to continue its winning streak on Wednesday morning, with a strong performance from Sports Direct International (SPD.L) helping it edge higher even as other European share indices succumbed to profit-taking.
Britain’s blue chip index, up marginally at 6,801 on Wednesday morning, has rallied hard over the past two days and is now 0.7% higher for the year, having erased January’s sell-off. It has only closed down on only one of the past 10 days.
News on the UK economy didn’t swat shares. A report showed the jobless rate actually rose to 7.2% in the period from October to December, confounded some expectations of a further decline from 7.1%.
Meanwhile the minutes from the Bank of England’s February policy meeting showed that the monetary policy committee was unanimous in keeping interest rates at a record low of 0.5%.
Although shares were unmoved by the economic news, the pound let go of early morning gains to trade flat at $1.6684 to the dollar. Sterling had also taken a hit on Tuesday after figures showing UK inflation fell back to 1.9% in January, providing the Bank of England with more leeway to keep interest rates lower for longer.
Investors will also be offered a glimpse into the mind-set of US policymakers today, with the minutes from the US Federal Reserve’s January policy meeting due later. The Fed cut its quantitative easing (QE) stimulus scheme for a second time at that meeting, meaning it now spends $65 billion (£39 billion) a month on bond purchases.
Of London shares, Sports Direct was the biggest blue chip gainer, up 5.4% to 755p after reporting a 14.6% increase in profits over the 13 weeks to 26th January.
Despite a 72% share price gain over the past year, Sports Direct is one of the most heavily tipped stocks on the FTSE 100.
‘Overall, with the company on track to meet market expectations, we think this is a decent performance and we maintain our view that Sports Direct is well positioned to drive long term growth both in the UK and overseas,’ commented Liberum analyst Sanjay Vidyarthi.