LONDON (Reuters) - Britain’s top share index rose to a two-month high on Tuesday, helped by gains in Carnival (CCL.L) and strength in the bank sector after Lloyds (LLOY.L) rose after a deal to buy a credit card business.
It hit its highest level since October 25, with blue chips supported by a drop in sterling to a 1-month low.
Banking stock Lloyds (LLOY.L) was among the top gainers, up 2.2 percent following its deal to buy the MBNA credit card business from Bank of America (BAC.N) for 1.9 billion pounds ($2.4 billion) in an effort to increase profit and reduce its reliance on mortgage lending.
“The anticipated financial performance and shareholder value creation that is expected to be generated by this transaction is impressive, in our view, and suggests a better use of capital than simply returning it to shareholders,” Gary Greenwood, analyst at Shore Capital, said in a note.
Top individual riser was Carnival (CCL.L), which ended up 3 percent after reporting results in the middle of the session.
The world’s largest cruise operator reported higher-than-expected quarterly revenue and profit, helped by an increase in ticket prices and onboard spending.
Precious metals miners were on the back-foot, with Fresnillo (FRES.L) and Randgold Resources RRS.L down 2.1 percent and 1.2 percent as the price of gold eased. [GOL/]
“Towards the year-end ... some fund managers (are) looking to book profits on stocks that have performed very well. If we take a look at some of the more diversified miners, they’ve seen aggressive moves this year,” Dafydd Davies, partner at Charles Hanover Investments, said.
Outside of the blue chips, Paysafe PAYS.L jumped over 5 percent after announcing a buyback of up to 100 million pounds sterling.
Editing by Angus MacSwan