LONDON MARKETS: FTSE 100 Gains As Tesco, Rolls-Royce Move Higher

By Carla Mozee, MarketWatch

U.K. stocks rose Wednesday, with Tesco PLC advancing despite reporting its biggest yearly loss on record, while Rolls-Royce PLC shares gained as the engine maker named its next chief executive.

U.K.'s FTSE 100 rose 0.2% to 7,076.80.

Tesco shares were among the best performers, rising 2.1%. The supermarket chain said it swung to a pretax loss of 6.38 billion pounds (http://www.marketwatch.com/story/tesco-reports-massive-loss-after-turbulent-year-2015-04-22) ($9.54 billion) for the year to Feb. 28. After a turbulent year that revealed a pattern of accounting overstatement, Tesco logged GBP7 billion in charges, including GBP4.7 billion related to the impairment of fixed assets.

Tesco's new chief executive, Dave Lewis, has been making changes at the supermarket company, including closing unprofitable stores and selling noncore assets.

"While Tesco looks like it's on a downward spiral with another major dip in trading profits, its planned recovery strategy promises to steer the retailer back on course," said Simon Johnstone, senior analyst at Kantar Retail, in a note. "A three-pronged attack to improve performance is centered on strengthening the balance sheet, repairing its reputation and rebuilding the brand."

Meanwhile, Rolls-Royce said Warren East will become its next CEO after its current CEO John Rishton retires on July 2. East previously served as CEO of chip designer ARM Holdings PLC . Rolls-Royce shares jumped 4%, while ARM shares turned lower, by 0.2%.

Among Wednesday's decliners, shares of Hargreaves Lansdown PLC fell 2.2% after Jefferies downgraded its rating on the investment services firm to hold from buy.

The FTSE 100 on Tuesday (http://www.marketwatch.com/story/ftse-100-climbs-as-arm-sky-bounce-higher-2015-04-21) finished higher by 0.2%.

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