Stocks in the U.K. Advance, Following Five Days of LossesJonathan Morgan
U.K. stocks rose, halting a five-day losing streak, as GlaxoSmithKline Plc gained after predicting that sales will climb as it introduces new medicines this year.
Glaxo increased 1.6 percent. RSA Insurance Group Plc posted its largest two-day gain in more than two years as Barclays Plc upgraded the insurer following the appointment of Stephen Hester as chief executive officer. Hargreaves Lansdown Plc dropped the most since August 2011 after saying that its operating-profit margin fell in the final six months of 2013.
The FTSE 100 Index added 8.6 points, or 0.1 percent, to 6,457.89 at the close in London after climbing as much as 0.5 percent and dropping as much as 0.4 percent. The benchmark has still fallen 5.5 percent since Jan. 20 as Argentina’s decision to allow the peso to devalue triggered a rout in emerging-market currencies. The FTSE All-Share Index also rose 0.1 percent today, while Ireland’s ISEQ Index gained 0.6 percent.
“U.K. equities have taken a breather following the rout,” said James Butterfill, who helps manage about $50 billion as head of global equity strategy at Coutts & Co. in London.
Glaxo added 1.6 percent to 1,579.5 pence as the U.K.’s biggest drugmaker forecast that revenue will rise by about 2 percent as it introduces treatments for skin cancer, HIV, influenza and respiratory disease. Earnings per share excluding some items will increase by 4 percent to 8 percent at constant exchange rates, the company said in a statement.
RSA added 4.7 percent to 103.6 pence. Barclays upgraded the insurer to equal weight from underweight, meaning that investors should no longer sell the shares. Hester, the former chief executive officer of Royal Bank of Scotland Group Plc, will succeed Simon Lee, who left RSA in December. Lee had injected two rounds of capital into the insurance company’s Irish business in just six weeks. RSA began an investigation into how the unit set aside reserves for insurance claims.
Balfour Beatty Plc gained 3.3 percent to 293.3 pence after RBC Capital Markets upgraded the shares to outperform, the equivalent of a buy recommendation, from underperform. The brokerage said that the outlook for construction in the U.K. and the U.S. -- Balfour Beatty’s largest markets -- has improved. RBC increased its price forecast for the shares to 310 pence from 210 pence.
Ryanair Holdings Plc climbed 3.2 percent to 7.02 euros after Cantor Fitzgerald LP reiterated its buy recommendation on Europe’s biggest discount airline. The brokerage also increased its price estimate to 8.30 euros from 7 euros.
Hargreaves Lansdown plunged 10 percent to 1,345 pence. The U.K.’s largest retail broker said its operating-profit margin dropped to 65.2 percent in the six months through December from
65.6 percent a year earlier. It also announced a payout of 7 pence a share in a statement, less than the Bloomberg Dividend Forecast of 7.3 pence.
The volume of shares changing hands in companies listed on the FTSE 100 was 19 percent greater than the average of the past 30 days, according to data compiled by Bloomberg.
In the U.S., a report from the ADP Research Institute showed that companies hired a net 175,000 employees in January. Economists had predicted a figure of 185,000. They added a revised 227,000 jobs in December.
The ADP data precedes the Labor Department’s payrolls release on Friday. The government report will show that the U.S. economy created 184,000 jobs last month, the median estimate in a Bloomberg survey shows.
The Institute for Supply Management said its index of U.S. non-manufacturing industries increased to 54 in January from 53 in December. The median forecast of 78 respondents in a Bloomberg survey had called for a reading of 53.7. Readings greater than 50 mean that activity expanded.