FTSE Gains as Airlines Perform Well
Airline shares helped to boost the FTSE 100, which cained 44.71 points during the first half of the day’s trading.
Exane BNP Paribas upgraded Lufthansa’s rating, and the strength of the German airline helped to bolster UK-listed peers, with IAG gaining 3.3 percent, to become the strongest performer in the FTSE 100.
The FTSE 250 also performed well, building on a strong performance on Monday, up by 0.6 percent, with JD Sports and Balfour Beatty both looking strong.
The FTSE 100 touched a three week high point this morning, but analysts feel that equities are going through a period of pricing in bad news. The economic backdrop is less fragile than people might think, though, and many analysts believe that as the overall economic climate stabilises, we could expect to see the markets outperform. So far, UK inflation held steady in March, and oil prices have fallen. While consumer spending appears to be stable right now, the squeeze on many households looks set to resume.
Retail sales figures show that British shoppers are clamping down on spending, and the cost of basic essentials is increasing, this could be bad news for supermarkets, which are already facing pressure from out of town discounters, and lower discretionary spending. Non-food retailers are also struggling with imported cost inflation and the steady fall in consumer spending this year.
Meanwhile, in the currency markets, the pound gained 0.1 percent against the dollar, and slipped by 0.05 percent against the euro.
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