The FTSE 100 moved higher on Tuesday with investors in good spirits ahead of an expected drop in the rate of UK inflation and a strong session for consumer goods giant Unilever.
The UK’s top stock market index was up 15.75 points or 0.2% to close at 7,738.3.
Unilever was leading the charge with shares up by 3%, after the company announced an overhaul which includes spinning off its ice cream business and axing 7,500 jobs around the world.
AJ Bell’s head of financial analysis, Danni Hewson, said: “Unilever has topped the FTSE 100 after announcing thousands of job cuts and doubling down on its promise to do fewer things better and with greater impact.
“To that end, its decision to spin off its ice cream business has succeeded in doing two things.
“It has shown investors that chief executive Hein Schumacher is seriously focused on delivering what he’s promised, and it has set the jungle drums beating about where this tasty new company might decide to call home.”
The gains helped offset bigger losses for rival consumer goods group Reckitt Benckiser, with shares trading about 4.5% lower.
Meanwhile, traders will be gearing up for expected good news on UK inflation, which is predicted to have fallen to its lowest level in nearly two and a half years in February.
Official data for February released on Wednesday could reinforce expectations that the Bank of England is moving closer to cutting interest rates this year.
Elsewhere in Europe, Germany’s Dax was up 0.31% and France’s Cac 40 closed 0.65% higher.
In the US, the S&P 500 was up by 0.35% and Dow Jones was 0.75% higher, ahead of the Federal Reserve’s latest interest rate decision announcement on Wednesday.
The pound was more or less flat against the US dollar at 1.2725 and the euro at 1.1715.
In other company news, shares in DFS were down 6% after the furniture retailer cut its sales and profits targets for the year, citing weaker demand over the past two months.
The company told shareholders that order volumes dropped 16% year-on-year across January and February. It also warned that profits could be knocked further by ongoing disruption to shipments in the Red Sea.
Elsewhere, Close Brothers shares moved higher after the banking group said it was planning on strengthening its balance sheet as it prepares for the outcome of the financial regulator’s review into the motor finance market.
The group said it could raise about £400 million worth of additional capital as part of cost-saving measures, including suspending its dividend to shareholders for the current financial year. Its share price closed 4% higher.
The biggest risers on the FTSE 100 were Unilever, up 117.5p to 3929p, Rolls-Royce, up 10.7p to 400.7p, IAG, up 3.45p to 159.9p, Ashtead, up 112p to 5,312p, and BAE Systems, up 22.5p to 1,327.5p.
The biggest fallers on the FTSE 100 were Reckitt, down 207p to 4368p, Fresnillo, down 19.8p to 441.4p, Airtel Africa, down 3.75p to 90.7p, Burberry, down 26p to 1,230p, and Persimmon, down 26.5p to 1,263p.