London markets were boosted by a good set of results from one of the world’s biggest consumer goods firms indicating consumers are still prepared to pay for higher prices.
The capital’s premier FTSE 100 index jumped 0.58 per cent to 7,348.50 points, while the domestically-focused mid-cap FTSE 250 index, which is more aligned with the health of the UK economy, dipped 0.32 per cent to 19,739.18 points.
A better than expected set of financials from Marmite maker Unilever this morning lifted market sentiment.
The firm raised its profit forecasts despite hiking prices to offset severe cost pressure caused by Russia’s invasion of Ukraine raising food manufacturing costs.
Its shares shot to the top of the FTSE 100, climbing 2.5 per cent.
That upgrade suggests Brits are still prepared to pay more for their favourite food brands.
Investors have been fearful of the UK economy being plunged into a recession if consumers react to historic high inflation by reining in spending.
“The challenges of inflation persist and the global macroeconomic outlook is uncertain,” Unilever chief executive Alan Jope warned.
The cost of living is forecast to top 12 per cent in October when another hike to the energy price cap lands, putting added pressure on household budgets.
Airlines lifted the mid-cap FTSE 250, despite a slew of results laying bare the damage travel disruption has dealt to the sector’s bottom line.
FTSE 250-listed easyJet reported losses this morning, marred by staff shortages forcing the budget carrier to scale back flights. Nonetheless, its shares were up around 1.5 per cent.
Fellow airline Wizz Air jumped over four per cent.
The pound lost ground on the greenback, weakening 0.07 per cent to buy $1.2033.
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