By Sara Sjolin, MarketWatch
Banks and oil firms lead U.K. benchmark higher
LONDON (MarketWatch) -- The U.K.'s benchmark stock index kicked
off the new month and quarter in positive territory on Wednesday,
boosted by a solid reading on the country's manufacturing
sector.
The FTSE 100 index added 1.1% to 6,846.81, setting it on track
for the biggest gain in two weeks.
On Tuesday, the benchmark slumped 1.7% as investors banked
profit after a solid quarter. The FTSE logged a 3.2% quarterly
gain, the biggest since the last quarter of 2013
(http://www.marketwatch.com/story/ftse-drops-but-stays-on-track-for-best-quarter-in-more-than-a-year-2015-03-31).
After a wobbly start on Wednesday, U.K. stocks cautiously
started to move higher, but were sent higher after the CIPS/Markit
manufacturing purchasing managers' index for March rose to an
eight-month high. The gauge came in at 54.4, ticking up from the 54
level in February and higher than consensus forecasts of 54.2. The
PMIs across the eurozone were also generally upbeat
(http://www.marketwatch.com/story/eurozone-manufacturing-activity-picks-up-in-march-2015-04-01).
Another data set was less upbeat, with the Office for National
Statistics reporting a 0.2% drop
(http://www.ons.gov.uk/ons/rel/productivity/labour-productivity/q4-2014/index.html)
in labor productivity measured by the hour in the fourth quarter of
2014.
The pound (GBPUSD) briefly rose after the PMI to trade as high
as $1.4873, but later slipped back to $1.4751. It exchanged hands
at $1.4819 late Tuesday.
"Any upside to the pound is going to be limited, and it's going
to struggle to find any traction as we near the election," said
Angus Campbell, senior analyst at FxPro. "The rallies have all been
so short-lived, and I think investors don't want to hold sterling
ahead of the election."
Among major movers in Wednesday's trade, shares of Lloyds
Banking Group PLC (LYG) rose 2.1% after Jefferies lifted the lender
to hold from underperform.
Among other banks, Royal Bank of Scotland Group PLC (RBS)
climbed 2.2%, Barclays PLC (BCS) put on 3.6%, Standard Chartered
PLC gained 0.5%, and HSBC Holdings PLC (HSBC) climbed 1.1%.
Oil firms, which were slammed lower by the declining oil price
on Tuesday, moved broadly higher on Wednesday. Shares of BG Group
PLC added 1.4%, Royal Dutch Shell PLC (RDSB) picked up 2.1%, and BP
PLC (BP) gained 1.3%. Crude-oil futures remained under pressure
(http://www.marketwatch.com/story/oil-futures-choppy-as-markets-eye-iran-talks-us-supplies-2015-04-01-11035551)
on Wednesday.
On a more downbeat note, shares of Kingfisher PLC gave up 1.7%.
The do-it-yourself retailer jumped 4.3% on Tuesday after announcing
a round of store closures at its B&Q chain
(http://www.marketwatch.com/story/kingfisher-net-profit-falls-will-close-stores-2015-03-31).
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