Britain’s top share index rose for the third day on the trot on Wednesday, boosted by gains among mining firms, though car insurer Admiral Group plummeted after reporting half-year results.
The blue chip FTSE 100 (FTSE) index was up 0.6 percent at 7,428.27 points by 0903 GMT, giving up some gains after sterling was boosted by stronger than expected UK earnings growth. Mid caps (FTMC) also advanced 0.6 percent.
“It is worth noting that, even after yesterday’s decline in the UK CPI rate and today’s surprise uplift for wage growth, the squeeze on the consumer remains, although not as tight as it once was,” said Kathleen Brooks, research director at City Index.
“So far, this data hasn’t had any impact on UK consumer discretionary stocks like M&S or Next. We may need to get confirmation of decent July retail sales figures before these stocks make a move.”
Admiral Group (L:ADML) slumped 6.7 percent, on course for its worst day since November 2011, after posting a weaker loss ratio for the first half.
“We see underlying margin deterioration in the core UK motor division as the key negative in the result. In addition, pricing increases appear weaker than peers at headline level,” analysts at UBS said in a note.
Admiral’s shares had rallied more than 21 percent ahead of the results, suggesting there might also have been an element of profit-taking behind Wednesday’s move.
A rise among mining firms supported the index, with the sector adding more than 10 points to gains.
Glencore (L:GLEN), Anglo American (L:AAL), Rio Tinto (L:RIO) and Antofagasta (L:ANTO) all rose between 1.8 and 2.3 percent, boosted by firmer copper prices. [MET/L]
Among smaller companies, shares in Balfour Beatty (L:BALF) led the mid caps with a jump of 7.4 percent after the construction firm saw its half-year profit rise nearly 70 percent thanks to a rebound in its UK construction business.
“Construction is all about margins and bidding too aggressively for work cost Balfour dearly for a couple of loss-making years in which it delivered seven profit warnings,” said Neil Wilson, senior market analyst at ETX Capital.
“Now it’s a lot more selective and as a result says it’s on course to achieve industry-standard profit margins by the second half of 2018.”
Silver miner Hochschild Mining (L:HOCM) slumped 15 percent after reporting first-half profit down by more than a third.