The FTSE 100 gained on Thursday with Imperial Brands leading the index higher as concerns about higher bond yields abated and investors adjusted to forward expectations of interest rates.
The FTSE 100 was up 0.4% to 7,443 shortly after midday in London as investors stepped back into equities after several negative sessions driven by interest rate worries.
“It looks like a typical knee-jerk reaction by investors – there have been plenty of signs to suggest central banks will continue with their fight against inflation by keeping rates high, but a lot of people seem to have been too complacent and expected a sudden drop in rates,” said Russ Mould, investment director at AJ Bell.
“With the message now loud and clear that this situation is unlikely in the near-term, investors can have some sort of certainty and thus reposition their trades accordingly.”
Tesco added to yesterday’s gains adding another 3.4% to 280p. Imperial Brands was the top gainer after announcing trade was in line with guidance and saw further growth in their new generation products.
“The maker of Lambert & Butler cigarettes and blu vapes has bounced back from a sluggish first half. Imperial Brands is now set to deliver modest growth in revenue and operating profit for the year just ended,” said Derren Nathan, head of equity research at Hargreaves Lansdown.
“This is particularly encouraging given the inclusion of the now suspended Russian operations in last year’s comparators. There has been growth in all product categories despite an industry wide decline in tobacco consumption.”
Imperial Brands shares rose 3.7%.
Falling oil prices hit majors BP and Shell who were the FTSE 100’s top fallers, shedding 1.7% and 1% respectively.
