LONDON MARKETS: EasyJet Jumps In London; FTSE 100 Off 10-month Low

By Carla Mozee, MarketWatch

LONDON (MarketWatch) -- EasyJet PLC shares cruised higher Friday after the air carrier raised a profit forecast, helping the benchmark FTSE 100 come off a 10-month low.

The FTSE 100 climbed 1.3% to 6,527.91, extending gains after U.S. jobs data for September came in stronger than expected.

EasyJet shares topped the benchmark, rising 6.4% as the budget airline said a pilot strike at rival Air France should help boost its pretax profit for the year to Sept. 30 by 5 million pounds ($8.07 million).

Earnings should now come in at GBP575 million to GBP580 million, the company said. EasyJet had previously expected earnings of GBP545 million to GBP570 million.

The FTSE 100 on Thursday slid 1.7% to its lowest closing level since December 2013. Other European markets also sold off as investors expressed dissatisfaction at the European Central Bank's efforts to stave off low inflation and stagnating growth in the eurozone.

Tesco PLC shares sat near the bottom of the British benchmark Friday as they fell 3.4%. Earlier this week, the U.K. Financial Conduct Authority began investigating the supermarket chain's recent overstatement of its first-year profit forecast by 250 million pounds ($405 million).

"I made a mistake on that," Berkshire Hathaway chief Warren Buffett said Thursday on CNBC about his company's investment in Tesco. "That was a huge mistake I made."

Meanwhile, the pound (GBPUSD) remained under pressure after Bank of England Deputy Governor Ben Broadbent said the U.K. is "not ready yet" for an increase in interest rates. The pound dropped to $1.5967 from around $1.6187 late Thursday.

Broadbent made the comment in an interview with ITV, broadcast on Thursday. Businesses and households should, however, prepare for higher rates, he said.

The BOE is poised to begin raising interest rates during the first quarter of 2015, economists at Goldman Sachs said on Friday. That timetable would mean the BOE would start hiking rates earlier than the U.S. Federal Reserve, which is seen as likely to start rate increases in the third quarter of 2015.

For the week, the FTSE 100 fell 1.8%, its second weekly loss in a row.

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