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FTSE reaches two-month high as Britain votes on EU membership

FTSE reaches two-month high as Britain votes on EU membership

LONDON: Britain’s top share index rose to a two-month high on Thursday as Britons began voting on its membership in the European Union, with recent opinion polls showing the “Remain” camp nudging ahead.

Two opinion polls published late on Wednesday showed signs of a last-minute rise in support for staying in the EU. Investors had mostly feared that a so-called Brexit would damage the economy in Britain and possibly beyond.

“Overnight polls still suggest the result could be very close, although a late tilt towards Remain has helped bolster bullish sentiment on the hope the status quo is maintained and an uncertain outlook will not prevail,” said Mike van Dulken and Augustin Eden at Accendo Markets.

The blue-chip FTSE 100 index was up 1.7 percent at 6,368.95 points by 0931 GMT, taking gains for the week to 5.6 percent, its biggest weekly advance since December 2011. Trading volumes were running about two-thirds below normal levels.

The mid-morning rise by the FTSE 100 accompanied a rise in sterling.

The index was led higher by a 2.8 percent rise in the UK mining index following an increase in copper prices.

Shares in Glencore rose 4.2 percent, the top gainer in the FTSE 100 index, while Anglo American, Rio Tinto and BHP Billiton were up 2.5 to 3.7 percent.

Tesco was up 4.1 percent after Britain’s biggest retailer reported a second straight quarter of underlying sales growth in the UK. That was the first successive quarterly gain in more than five years, signalling Tesco’s recovery is making progress.

“Tesco has maintained the positive momentum it picked up around the beginning of this year, with sales continuing to rise against a challenging retail backdrop,” said Laith Khalaf, a senior analyst at Hargreaves Lansdown.

“The elephant in the room is Amazon, which is currently testing out a grocery delivery service for some customers in London; if successful this represents a clear and present danger to the health of UK supermarkets.”

United Utilities was the only stock in negative territory, falling 2.4 percent, as its shares traded without the attraction the latest dividend payouts.

Copyright Reuters, 2016

Courtesy : BRecorder



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