U.K. Stocks Rise to Six-Week High as Homebuilders AdvanceSofia Horta e Costa
U.K. stocks rose to a six-week high as reports showed U.S. retail sales climbed in June and China’s second-quarter economic growth matched estimates.
Royal Bank of Scotland Group Plc jumped 5.1 percent, leading lenders higher as Rightmove Plc increased its growth forecast for British house prices. U.K. housebuilders advanced as Taylor Wimpey Plc closed at its highest price in five years.
The FTSE 100 Index advanced 41.17 points, or 0.6 percent, to 6,586.11 in London, its highest level since May 30. The gauge climbed 2.7 percent last week, its second-biggest weekly rally this year, and has rallied 12 percent so far this year. The FTSE All-Share Index also increased 0.6 percent today, while Ireland’s ISEQ Index was little changed.
“Growth in China will be lower, but broader and perhaps more sustainable as well,” Wayne Bowers, chairman of asset management at Northern Trust Corp. in London, told Francine Lacqua on Bloomberg Television. “One thing to recognize is the absolute nominal size of the Chinese economy. Growth of 6.5 percent three years ago would have been extremely worrisome, but now we’re looking at a bigger pie.”
In the U.S., retail sales rose 0.4 percent in June after increasing 0.5 percent the previous month, a report in Washington showed today. Economists surveyed by Bloomberg had predicted a gain of 0.8 percent.
China’s second-quarter gross domestic product rose 7.5 percent from a year earlier, according to the National Bureau of Statistics in Beijing. That matched the median forecast in a Bloomberg News survey. The economy expanded at a 7.7 percent pace in the first quarter.
Stocks rallied last week as Federal Reserve Chairman Ben S. Bernanke said the central bank’s policy would remain “highly accommodative” and the Bank of Japan indicated it will maintain stimulus. The European Central Bank and Bank of England had said they will keep interest rates low for the foreseeable future.
RBS added 5.1 percent to 320 pence, leading a gauge of U.K. lenders higher. Rightmove Plc, which operates a property website, projected that asking prices for British houses will increase 4 percent this year, compared to a previous forecast for a gain of 2 percent.
Lloyds Banking Group Plc increased 2.5 percent to 69.44 pence, its highest price in 2 1/2 years. Barclays Plc gained 1.2 percent to 309.75 pence, extending this year’s rally to 18 percent.
Developers Redrow Plc and Kier Group Plc rose 4.7 percent to 252 pence and 4.1 percent to 1,486 pence, respectively. Taylor Wimpey added 2.4 percent to 107.9 pence, its highest price since April 2008.
Travis Perkins Plc, which sells materials for the construction industry, added 1.4 percent to 1,656 pence for its highest price in more than six years.
G4S Plc slipped 1 percent to 207.5 pence, its lowest price in four years, after the Sunday Times reported that the security provider has discussed options to raise capital from large investors. The newspaper cited an interview with Chief Executive Officer Ashley Almanza.
The number of shares changing hands today in FTSE 100-listed companies was 21 percent lower than the average of the past 30 days, data compiled by Bloomberg show.