LONDON MARKETS: FTSE 100 Rises, Helped By Unilever's Leap And Pound's Drop

By Victor Reklaitis, MarketWatch

Sterling falls after disappointing U.K. retail sales

U.K. stocks gained Friday, adding to their weekly advance, boosted by Unilever PLC's jump on buyout-related news and the pound's drop after discouraging data on U.K. retail sales.

The FTSE 100 moved higher by 0.3% to 7,301.56, after trading in the red in morning action. The rise put the blue-chip benchmark on pace for a 0.6% gain for the week.

On Thursday, the index lost 0.3%, retreating from a one-month closing high reached in the prior session.

Shares in consumer-products giant Unilever PLC (ULVR.LN) (UNA.AE) (ULVR.LN) soared 14%, powered by U.S. packaged-foods heavyweight Kraft Heinz Co. (KHC) announcing that it made a merger proposal (http://www.marketwatch.com/story/kraft-heinz-confirms-merger-proposal-with-unilver-was-declined-2017-02-17) to Unilever that was declined.

The pound was trading at $1.2427, down from $1.2494 late Thursday, as traders reacted to a January report on U.K. retail sales. The report showed a month-over-month drop of 0.3%, missing forecasts for a rise.

The retail sales number was "really weak," showing British consumers are starting to feel the squeeze due to a pickup in inflation (http://www.marketwatch.com/story/uk-inflation-hits-2-year-high-beats-views-2017-01-17), said Naeem Aslam, chief market analyst at Think Markets UK, in a note.

"The net impact on the currency after the data was bad, and we have seen traders putting more short trades against the sterling-dollar pair," he added.

The FTSE 100 lifted off its session low as sterling slumped. A weaker pound often boosts the London benchmark as around 75% of the index's revenues come from overseas in other currencies.

Investors also were digesting U.S. President Donald Trump's lengthy press conference (http://www.marketwatch.com/story/trump-attacks-media-during-lengthy-press-conference-2017-02-16) on Thursday, in which he said he "inherited a mess" at home and abroad, and blasted the news media.

Movers: Coca-Cola HBC AG's shares gained 2.5% for one of the FTSE 100's biggest gains. The stock is building on Thursday's jump of 4.9%, which came after the bottling company said profit rose last year (http://www.marketwatch.com/story/coca-cola-hbc-2016-profit-up-lifts-dividend-2017-02-16).

AstraZeneca PLC (AZN.LN) (AZN.LN) rose 2.3% after the drug company announced positive results from a trial (http://www.marketwatch.com/story/astrazeneca-breast-cancer-drug-trial-positive-2017-02-17) of its breast cancer treatment Lynparza.

Asia-focused bank Standard Chartered PLC (STAN.LN) gave up 3.3% for the FTSE's largest loss.

(END) Dow Jones Newswires

February 17, 2017 07:58 ET (12:58 GMT)

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