U.K. Stocks Advance First Time in Three Days

U.K. stocks advanced for the first time in three days as investors weighed prospects for corporate earnings and watched political developments in Ukraine.

Capita Plc (CPI) jumped to its highest price since at least 1989 after saying it obtained 588 million pounds ($979 million) of contracts since the start of 2014. Whitbread Plc rallied to a 22-year high after posting sales that beat estimates. Royal Bank of Scotland Group Plc tumbled to its lowest price this year after reporting its biggest full-year loss since 2008. WPP Plc lost 3.5 percent after saying its profit margin slid.

The FTSE 100 Index (UKX) rose 11.12 points, or 0.2 percent, to 6,810.27 at the close in London, erasing losses in the final hour of trading. The benchmark has advanced 4.6 percent in February. The broader FTSE All-Share Index also added 0.2 percent and Ireland’s ISEQ Index climbed 0.7 percent.

In the U.S., a Labor Department report showed that initial jobless claims increased by 14,000 to 348,000 last week. Economists in a Bloomberg survey had forecast a drop. Separate data showed durable-goods orders fell 1 percent in January, slower than the 1.7 percent projected by economists.

Russia and the new regime in Ukraine faced off over Crimea, raising the risk of an armed conflict in the region. The presidium of the Crimean parliament said it may hold a referendum to decide the future of the autonomous region, hours after gunmen occupied government buildings and raised the Russian flag.

Interim Government

Crimea is the latest flash point in a violent conflict since November that culminated in the ouster of Viktor Yanukovych as Ukraine’s president and the formation of an interim government.

At the core of the unrest is Ukraine’s future itself. Yanukovych chose ties with Russia, abandoning a closer association with the European Union that his detractors favor. His departure rattled parts of Ukraine’s Russian-speaking east and south, where supporters of Moscow have clashed with ethnic Tatars. Russia has weighed in, carrying out military exercises and checking the combat readiness of some of its units.

Capita, a service provider to the U.K. government, gained 6.7 percent to 1,158 pence. The company said it made a strong start to 2014, with 588 million pounds of new contracts. Revenue increased 15 percent to 3.85 billion pounds in 2013.

Whitbread Sales

Whitbread (WTB) rose 4.9 percent to 4,397 pence. The owner of Costa Coffee shops said comparable sales at its Premier Inn budget-hotel chain rose 8.3 percent in its fourth quarter and Costa sales advanced 7.3 percent. Analysts in a Bloomberg survey expected an increase of 5 percent in both businesses.

RBS (RBS) declined 7.7 percent to 326.6 pence. The lender bailed out by the U.K. government in 2008 said its net loss widened to about 9 billion pounds ($15 billion) in 2013 from 6.1 billion pounds in the year-earlier period. The pretax operating loss, at 8.2 billion pounds, overshot the 5.28 billion pounds estimated by analysts in a Bloomberg survey. RBS also announced plans to shrink its investment-banking and overseas operations.

WPP Plc (WPP) fell 3.5 percent to 1,285 pence, its biggest drop since May. A strong pound cut its profit margin by 0.2 points last year, the company said. Revenue increased 6.2 percent to 11 billion pounds, missing the 11.1 billion-pound average estimate of analysts.

RSA Insurance Group Plc lost 4 percent to 98.1 pence. The company plans to raise 775 million pounds in a share sale and scrap its final dividend to replenish capital depleted by a scandal at its Irish unit.

To contact the reporter on this story: Corinne Gretler in Zurich at cgretler1@bloomberg.net

To contact the editor responsible for this story: Cecile Vannucci at cvannucci1@bloomberg.net

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