FTSE edges up ahead of BoE policy meeting
Gains in defensive stocks like consumer staples and healthcare lifted the FTSE by 0.2 percent by 0852 GMT.
Gains in defensive stocks like consumer staples and healthcare lifted the FTSE by 0.2 percent by 0852 GMT, while rate-sensitive financials were a drag and energy stocks underperformed on expectations of an OPEC deal to raise output.
The mid-cap index was flat.
While no economist polled by Reuters expects the BoE to lift rates on Thursday, the central bank may lay some groundwork for a future rise if it judges the economy is now turning a corner after an unusually weak start to the year.
"The main impetus for FTSE upside likely derives from fresh GBP weakness ahead of the crucial... policy update," said Mike van Dulken and Artjom Hatsaturjants at Accendo Markets.
The decision to keep rates unchanged is fully priced in but markets are still giving 50/50 chance to a hike in August and are assigning a 15 percent probability to a second hike by the end of the year, according to UniCredit strategists.
Heavyweight consumer stocks British American Tobacco and Unilever, which have benefited from the recent strength in the dollar, rose 1.9 and 1.5 percent respectively, while drugmaker Shire also gave a big lift to the FTSE, up 2.3 percent.
Land Securities and United Utilities fell as their shares traded without the right to the latest dividend payment.
Sky rose for a second day, up 1.3 percent at a two month high, after Disney raised its offer for the bulk of Twenty-First Century Fox's entertainment assets, including the 39 percent stake in the UK-based pay-TV company.
The move has raised speculation Fox will raise the bid for Sky, beating a bid from Comcast, although Liberum analyst Ian Whittaker said the room for further upside may be limited.
"We do not think it will be bid more than 10 percent above Comcast's bid, implying 1375p, which is where the shares are now," he said.
Energy stocks underperformed as oil prices fell as crude exporters in OPEC appeared to be nearing a deal to increase production. The Organization of the Petroleum Exporting Countries holds its biannual meeting in Vienna on Friday.
Royal Dutch Shell fell 0.4 percent and BP was flat.
(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)