FTSE 100 close: London powers into the green after retail rebound, Natwest shares soar
London markets shot into the green on Friday as strong retail sales figures raised the prospect the UK would soon escape its recessionary malaise.
The FTSE 100 closed 1.50 per cent higher to end at 7,711.71 while the FTSE 250, which is more aligned with the health of the domestic economy, rose 0.48 per cent to trade at 19,191.93.
“Market sentiment is being buoyed by better-than-expected retail sales,” Sophie Lund-Yates, lead equity analyst, Hargreaves Lansdown.
Retail sales volumes were up 3.4 per cent in January, compared to the 1.5 per cent expansion expected by economists. This offset the large fall in December when Black Friday discounting pushed forward Christmas sales into November.
A number of economists said the figures suggest the UK might already be moving out of a recession. Lund-Yates said the figures suggested the economy is “primed to slowly emerge from hibernation.”
Martin Beck, chief economic adviser to the EY Item Club said: “Lower inflation means real wages should continue to rise, while the prospect of cuts in energy bills will boost households’ spending power”.
On the FTSE 100, Natwest beat expectations in the final quarter of last year, helping the bank to record its strongest figures since the financial crisis. Its shares gained over seven per cent.
The scandal-hit lender notched an operating profit of £6.2bn for 2023, up 20 per cent on 2022’s figure. The high street lender also confirmed Paul Thwaite would permanently succeed Dame Alison Rose as boss.
Rose left the bank under a cloud after the Farage debanking brouhaha.
Other banks joined the rally with Lloyds rising 3.9 per cent per cent and Barclays up 2.3 per cent.
Shares in Segro gained 1.9 per cent. The London-listed real estate investment trust said this morning that it could see rental income from its portfolio grow by more than 50 per cent over the next three years.