Primark owner, Rolls-Royce support UK bluechip shares
By Bansari Mayur Kamdar
Nov 9 (Reuters) - UK shares inched higher on Tuesday as positive earnings outlook lifted shares of Primark-owner AB Foods, while engineering company Rolls-Royce jumped after securing a government funding.
AB Foods jumped 6.2% to the top of the blue-chip index after it forecast a significant increase in sales and profit at its Primark fashion chain in its new financial year and announced a special dividend.
"When restrictions ended, you had long queues for Primark just demonstrating how clever and how well loved the brand is," said Danni Hewson, analyst at AJ Bell.
"AB Foods looks well positioned because they have such a diverse business empire, which has managed to hold up Primark when it was in a tricky phase during the pandemic."
Rolls-Royce jumped 4.9% to a 19-month high after Britain committed 210 million pounds ($283 million) to help it build the country's first small modular nuclear reactor as a part of its drive to reach net zero carbon emissions.
The FTSE 100 index was up 0.1% in morning trade, as weakness in the banking sector checked gains.
HSBC, Barclays and Lloyds were all down about 1%.
Banks have come under pressure recently after the Bank of England kept interest rates unchanged last week, wrong-footing investors who were convinced it was about to become the first of the major central banks to raise rates, and banks that were expecting a rise in borrowing costs to boost their profitability.
The domestically focussed mid-cap index added 0.2%.
Homebuilders slipped 0.9% after Persimmon and Vistry Group Plc highlighted supply chain problems and said they expected building costs to rise, while also emphasizing strong housing demand to back their outlook.
(Reporting by Bansari Mayur Kamdar in Bengaluru; Editing by Subhranshu Sahu and Shinjini Ganguli)
