The FTSE 100 was supported by domestic-facing UK shares and weaker sterling on Friday after the Bank of England paused its hiking cycle on Thursday.
A rally in UK banks and housebuilders reflected relief from the pressure of constantly rising interest rates as Lloyds rose 3% and Barratt Developments added 1.3%.
Stocks reliant on the UK consumer also enjoyed marginal improvements in UK retail sales data and consumer confidence released on Friday.
“UK retail sales have edged up 0.4% following a sharp drop in July caused by wet weather. This coincides with news that UK consumer confidence has reached a 20-month high, with GfK’s consumer confidence index showing a four point rise to a net minus 21,” said Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown.
Frasers Group and Auotrader were among the gainers in Friday afternoon trade.
However, improving UK economic data was not enough to provide support for the pound which hit multi-month lows against the dollar on Friday.
The Bank of England’s decision to keep rates on hold has been bearish for the pound while the Federal Reserve’s suggestion they will keep rates higher for longer has helped lift the dollar.
Weaker GBP/USD provided additional support for the FTSE 100 with many overseas earners in positive territory. Miners were higher as commodity prices rallied.
Ocado was the top riser after recovering some of their 20% decline yesterday.
Although neither company is listed in London, the big news on Friday was the UK CMA’s approval of the Microsoft takeover of Activision.