Key investments in Tobacco, consumer goods make UK shares rise ahead of Brexit voteDevdiscourse News Desk | Updated: 29-01-2019 15:41 IST | Created: 29-01-2019 14:56 IST
British shares were higher on Tuesday as investors sought safety in tobacco, utility and household goods companies amid fresh worries about the U.S.-China trade spat and ahead of an important parliamentary vote on Brexit later in the day.
Against the trend, Hargreaves Lansdown was set for its worst daily performance in May 2017 after reporting a weak half-year update, while Royal Mail plunged to record lows after failing to deliver its full-year guidance. The FTSE 100 index added 0.9 percent and FTSE 250 inched 0.4 percent higher by 0857 GMT, ahead of parliamentary votes to decide the next steps in the Brexit process that is scheduled today.
Parliament will debate and vote on what changes they want British Prime Minister Theresa May to seek to her Brexit deal, in an attempt to shape the future of the country's exit from the European Union. "Today's vote is by no means the end of the Brexit saga. In fact, it will open the door to further debate and discussion, as a result the impact on the pound could be limited," said Jasper Lawler, Head of Research at London Capital Group.
London stocks were outperforming their euro-zone peers, which were pressured by a series of U.S. corporate profit warnings overnight and after the U.S. announced criminal charges against Huawei Technologies, escalating a fight with the world's biggest telecommunications equipment maker. The charges, which came just days before a round of trade talks with Chinese Vice Premier Liu He who is set to meet U.S. officials this week, dampened hopes of significant progress in Beijing and Washington reaching a trade deal.
Defensive stocks seen as a safer bet during uncertain economic times - tobacco companies, Unilever and utilities - were among the best performers. Oil & gas stocks were also boosted by higher crude prices. British American Tobacco jumped nearly 5 percent and was the biggest blue-chip gainer. A trader cited the move to Piper Jaffray rating hike to overweight.
But fund supermarket Hargreaves Lansdown slid near 7 percent to be the worst faller on the main index after it reported a drop in assets under administration due to market losses. Gains in midcaps were capped with Royal Mail - a former FTSE 100 constituent - slumping 11.3 percent to a life low after a downbeat trading update and PZ Cussons tumbling 11.7 percent after a profit alert.
UDG Healthcare jumped 8 percent to lead mid-cap gainers after forecasting higher adjusted earnings and house-builder Crest Nicholson advanced 3.1 percent following a rise in revenue and volumes. Domino's Pizza, Britain's biggest pizza delivery firm, tanked 10 percent and was on track for its worst day since August after guiding to profit at low end of the consensus range.