January 23, 2013 / 8:13 AM / 5 years ago

FTSE hits 6,200 after Unilever earnings boost

LONDON (Reuters) - The FTSE 100 share index hit the 6,200 level for the first time since May 2008 on Wednesday after Unilever got the UK earnings season off to an encouraging start, sending its stock to a record high.

The London Stock Exchange is seen during ther morning rush hour in the City of London April 11, 2011. REUTERS/Toby Melville

Shares of the Anglo-Dutch consumer goods company rose 3.1 percent to top 2,500 pence for the first time ever on strong turnover after Unilever reported underlying sales growth of 6.9 percent for 2012.

It beat forecasts for 6.5 percent growth, propelled by a double-digit sales expansion in emerging markets.

The FTSE 100 saw a late surge that briefly took it above the psychologically significant 6,200 level. It closed up 18.47 points, or 0.3 percent, at 6,197.64 with Unilever accounting for 3.5 points of the index gain.

The FTSE has now hit a fresh 4-1/2 year high in nine of the past 11 sessions.

“As we are now holding above some key levels on the FTSE 100, namely 6,105 and 6,150, we see continual upside from the market from here,” Atif Latif, director of trading at Guardian Stockbrokers, said.

A worker shelters from the rain as he passes the London Stock Exchange in the City of London at lunchtime October 1, 2008. REUTERS/Toby Melville

“Earnings have once again beaten expectations and forward looking estimates remain at elevated levels alongside better economic data. From experience, we do expect this uptrend to remain intact over the short term and break above some recent highs.”


A trader monitors the screen on a trading floor in London January 22, 2010. REUTERS/Stefan Wermuth

Leading the late surge was Tullow Oil. It rose 3.5 percent, overtaking Unilever as the top index riser, as rumours circulated that drilling at a key well in Kenya which the company part owns may have been successful, with official results due shortly.

Tullow has a 50 percent share of the Kenyan Paipai prospect, in partnership with UK mid-cap Afren and Canada’s Africa Oil, who hold 20 and 30 percent stakes respectively. Afren closed 9.2 percent higher.

“The reason is market rumours that drilling results on the Kenyan Paipai prospect are coming,” a trader said.

Tullow shares were also supported by news that Uganda, where the company has a significant presence, is to auction 13 more blocks for oil and gas exploration.

In all, the energy sector including oil and gas firms added 9.3 points to the FTSE 100 index, while the FT350 Oil and Gas firms index hit a three-month high.

Editing by Susan Fenton

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