The FTSE 100 rose on Wednesday after a a strong session in the US overnight driven by central bank expectations.
The FTSE 100 had edged up 0.2% to 7,786 at the time of writing.
Nervousness earlier in the week has been replaced by mild optimism the Federal Reserve and Bank of England would soon start to slow the pace of their rates hikes, and could even cut rates towards the end of the year.
The prospect of easier monetary policy buoyed US stocks overnight where the S&P 500 closed up over 1%.
“The FTSE 100 moved higher on Wednesday morning, with today’s trading session in London sandwiched by strong gains on Wall Street overnight and the US Federal Reserve’s decision on interest rates later,” said AJ Bell investment director Russ Mould.
“A lot is riding on the Fed dialling back the pace of rate hikes to 25 basis points and there will also be plenty of attention on the surrounding messaging from chair Jerome Powell and his colleagues. Helping the market’s mood on Tuesday was data that revealed slowing US wage growth, another signal that inflationary pressures have peaked.”
GSK
GSK, formerly known as GlaxoSmithKline, dipped slightly on Wednesday after the pharma giant reported strong sales growth for 2022. GSK shares had been bid up over the last week and the numbers proved to be lacking the punch to keep the rally going through the trend line in a downtrend started in December.
“GSK, or Glaxo as market greybeards still know it as, reported underlying sales growth of 13% for the year just ended. Currency moves pushed the reported numbers up even higher,” said Steve Clayton, head of equity funds at Hargreaves Lansdown.
“Growth was driven by specialty medicines, up 29% and HIV treatments, 12% higher. The rest of the portfolio saw strong gains also from oncology and immuno-inflammation treatments. Blockbuster shingles vaccine, Shingrix was the star of the show, delivering £3bn of sales, up 72%. The group currently has a pipeline of 69 treatments, 19 of which are in late-stage trials. Underlying earnings jumped by 18% to 110.8p.”
Entain
Entain was among the best performers on Wednesday following a record fourth quarter helped by growth in their US business and the World Cup.
The company also completed a number of European acquisitions which promise top line growth in 2022.