LONDON MARKETS: U.K. Stocks Mark First Win In 2015

By Carla Mozee, MarketWatch

LONDON (MarketWatch) -- U.K. stocks rose Wednesday, gaining alongside European stocks as investors bet on further stimulus measures from the European Central Bank.

The FTSE 100 ended up 0.8% at 6,419.83, the first advance in 2015, as just 13 of the index's components finished lower.

The benchmark rose as much as 1.5% following the release of a below-consensus report on eurozone consumer prices. The data coming from Eurostat appear to "strengthen the case for there to be some kind of quantitative easing or monetary easing in the short-term rather than in the medium-term," said Richard Hunter, head of equities at Hargreaves Lansdown.

The eurozone is the U.K.'s largest trading partner, and weakness there has had a dampening effect on the U.K. economy.

In the key energy group, BP PLC (BP) rose 1% and Royal Dutch Shell PLC (RDSB) turned 1.6% higher. The oil company has agreed to pay about $80 million to compensate a Nigerian community for damage from two oil spills in 2008. Shares of oil producer BG Group PLC shed 0.4%.

The oil sector has been hammered in recent weeks as oil prices have slid to more than five-year lows. Brent crude on Wednesday briefly fell below $50 a barrel for the first time since May 2009.

In terms of oil generally, "investors are starting to appreciate that there's a flip side to lower oil prices which is positive particularly for consumers, on the basis that it's effectively a tax cut, especially at the petrol pumps, and, of course, airlines and travel stocks," said Hunter.

Retail stocks had strong showing after J Sainsbury PLC reported a narrower-than-expected decline of 1.7% in fiscal third-quarter same-store sales, excluding fuel. The period included the key Christmas season. Sainsbury shares (JSAIY) had been at the top of FTSE earlier Wednesday, but eventually fell 1.9%.

While comparable sales were better than expectations "this is still a strategically concerning result," said David McCarthy, head of European consumer retail research, at HSBC in a note. "An improved consumer environment...may help to a degree, but we believe that the sector's defining factor this year will be Tesco's strategy."

Tesco PLC (TSCDY), Britain's largest supermarket chain, is due to release a trading update on Thursday. Tesco shares ended 2.1% higher on Wednesday. Department store operator and food retailer Marks & Spencer PLC rose 2.2% while Wm Morrison Supermarkets PLC shares turned 1.1% lower.

Meanwhile, Aggreko PLC shares rose 3.3% as the temporary-power provider said it sees a small increase in 2014 profit after it won a two-year contract in Argentina and extended an existing contract with the same customer by two years.

Persimmon shares added 1.1% following the home builder's report that it sold 17% more homes at higher prices in 2014.

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