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* UK inflation slows lesser than expected to 3.2%
* ASOS rises on retaining FY outlook, naming new CFO
* Entain climbs on better-than-expected results
* FTSE 100, FTSE 250 add 0.5% each
April 17 (Reuters) – British stocks climbed on
Wednesday, underpinned by industrial metal miners, while the
pound strengthened after a slower-than-expected pace of
inflation fall pushed back hopes of a rapid rate cut by the Bank
of England.
The resources-heavy FTSE 100 and the mid-cap FTSE
250 gained 0.5% each after posting steep losses on
Tuesday.
Industrial metal miners gained 2.7%, with
shares of Rio Tinto up 3%, after iron ore
futures climbed to their highest levels in more than five weeks.
Aerospace and defence sector was the top
loser, dropping nearly 1%, as geopolitical risks over the Middle
East conflict persisted.
Britain’s inflation slowed to 3.2% in March, compared with
3.4% a month ago, but was slightly higher than economists’
expectations of 3.1%, according to a Reuters poll.
“We are in that consolidation phase and in between
narratives. The market is shifting from a soft landing to higher
for longer it creating a little bit of noise,” said Lilian
Chovin, head of asset allocation at the British private bank
Coutts.
“Therefore, we are going to remain in this range until more
data gets released and we have confirmation of a slowdown.”
Traders now expect the Bank of England to cut rates by 38
basis points in 2024, with the possibility of a first rate cut
only in November.
U.S. Federal Reserve Chair Jerome Powell said on Tuesday
that monetary policy needs to be restrictive for longer, further
dashing investors’ hopes for meaningful reductions in borrowing
costs this year.
Among individual stocks, ASOS advanced 5% after the
online fashion retailer appointed a new CFO and reiterated its
full -year forecast for adjusted core profit despite stiff
competition and excess inventory.
Shares of Burberry gained 2% after rival LVMH’s
first-quarter sales rose and roughly met forecasts.
Entain gained 3.6% after the owner of Ladbrokes
posted better-than expected first-quarter online gaming revenue
due to a rise in its customer base.
(Reporting by Pranav Kashyap in Bengaluru; Editing by Sherry
Jacob-Phillips)
