By Barbara Kollmeyer
London stocks climbed on Friday, tracking gains for global equities with resource stocks in the driver’s seat. That is as fresh data showed the strongest growth in the country in nearly a year.
The FTSE 100 index /zigman2/quotes/210598409/delayed UK:UKX -0.65% climbed 0.6% to 7,131.22, for a gain of 0.9% as the week comes to a close. The pound /zigman2/quotes/210561263/realtime/sampled GBPUSD +0.0503% slipped 0.2% to $1.4146.
The index was testing near-term highs around 7,120 earlier on Friday, and a breakthrough that could “call for the test of the post-pandemic peak at 7,164,” said Neil Wilson, chief market analyst for Markets.com, in a note to clients.
Stocks got a boost globally, as investors shook off news of surging consumer prices in the U.S. on Thursday. U.S. stocks climbed in early trading.
“Perhaps central banks really have convinced the markets that any rise in inflation will be short-lived and will not force them to ramp up rates too rapidly,” said AJ Bell investment director Russ Mould, in a note to clients.
Meanwhile, data showed the U.K. economy surged by 2.3% in April, as less restrictive COVID-19 measures drove higher consumer spending. The data are “further proof that the positive direction of travel is becoming established,” said Richard J. Hunter, head of markets at Interactive Investor, in a note to clients.
The clearing of economic clouds has been beneficial for sterling and the more domestically geared FTSE 250 index /zigman2/quotes/210598417/delayed UK:MCX -0.44% — up 0.6% on Friday — Hunter added.
“While the strength of sterling may crimp dome of the further gains for the premier FTSE 100 index, currently up by 9.9% this year, the U.K. is gaining popularity as an investment destination, with its undemanding valuation increasingly enticing overseas institutional buying interest,” he said.
Resource stocks drove gains on Friday as metals prices rose. Shares of miners Rio Tinto /zigman2/quotes/208934945/delayed UK:RIO -2.94% /zigman2/quotes/202627887/composite RIO -2.66% and Anglo American /zigman2/quotes/201381512/delayed UK:AAL -3.11% rose 2% each and Glencore /zigman2/quotes/201400686/delayed UK:GLEN -1.79% gained 3%, respectively.