News wire — London’s FTSE 100 ended higher on Wednesday as higher yields and upbeat earnings from insurer Prudential aided financial stocks, while a drop in oil prices helped allay some inflation and economic growth concerns among investors.
The blue-chip index FTSE 100 rose 3.3%, with banks, insurers and automakers leading gains.
Bond yields rose across the spectrum – the longer end 30-year yield rose to its highest since May 2019 and the shorter end 2-year yield gained for the third straight session – helping banking shares rise 5.4%.
Prudential jumped 8.6% and was among the top gainers after the Asia-focussed insurer posted a 16% rise in its 2021 operating profit, though it warned of implications for global markets and the economy from Russia’s invasion of Ukraine.
“I think the market appears to be not necessarily in a ‘buy the dip’ mode but certainly squaring off some short positions. It’s bit of a tentative buying but nothing too excessive,” said Chris Beauchamp, chief market analyst at online trading platform IG.
Unilever rose 2.9% after it became the first major European food company to stop imports and exports out of Russia following the country’s invasion of Ukraine.
Tobacco manufacturer Imperial Brands joined the list of multinationals stepping back from Russia and peer British American Tobacco said it had suspended all capital investment in Russia.
The benchmark index has eased 2.6% so far this year, the least among its pan-European peers, supported by stronger commodity prices. However, the rising energy costs has raised inflationary concerns.
The energy sub-index fell nearly 2% after oil prices dropped 5%, pulling back from a rally to peaks not seen in more than a decade, helping cool rising inflation risks.
The domestically focused mid-cap index advanced 4.4%, with travel and leisure among the top gainers.
Legal & General Group Plc jumped 6.0% after the life insurer and asset manager reported an 11% jump in annual operating profit to 2.26 billion pounds ($2.96 billion), as economies recover from the COVID-19 pandemic.
Polymetal International leaped 69.2%, rebounding from a record low in the prior session, after the Russia-exposed miner said its Russian operations continued undisrupted.
(Reporting by Amal S and Shashank Nayar in Bengaluru; Editing by Subhranshu Sahu, Krishna Chandra Eluri and Alex Richardson)
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