Reuters: Hot Stocks: FTSE 100 at five-month high on accommodative Fed, corporate updates

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FTSE 100 at five-month high on accommodative Fed, corporate updates Oct 22nd 2013, 14:58 Share this Email Print Reprints Tue Oct 22, 2013 11:50am EDT * FTSE 100 up 0.6 pct, highest close since late May * Reckitt, BHP lead gainers after strong updates * Weak US jobs number boosts chances of continued stimulus By Toni Vorobyova LONDON, Oct 22 (Reuters) - Britain's FTSE 100 scaled five-month highs on Tuesday, supported by expectations the U.S. Federal Reserve will not trim stimulus any time soon and by a crop of strong updates from the likes of Reckitt Benckiser . A disappointing U.S jobs report suggested that momentum in the world's top economy had already started to slow in September. With October numbers likely to be negatively affected by a two-week government shutdown, that bolstered expectations the Fed will wait until next year before starting to scale back its quantitative easing (QE). "Good news is good news because it means the economy is getting better, but bad news is almost good news because it means you are not going to get any tapering of QE," said Colin Morton, fund manager at Franklin Templeton. "I know that can't always be the case but that's certainly how the market is feeling at the moment." The FTSE 100 closed up 41.46 points, or 0.6 percent, at 6,695.66 points, notching up its highest finish since late May after extending gains sharply following the non-farm payrolls report and a strong start on Wall Street. Consumer goods group Reckitt Benckiser gave the biggest boost to the FTSE 100, its shares up 5.2 percent after solid third-quarter sales prompted a rise in full year guidance. The firm said a recovery in developed markets had offset some weakness in emerging economies. Investors also welcomed news that Reckitt may sell its pharmaceuticals unit to focus on consumer and household goods. "We are smiling here, because we own it," said Morton at Franklin Templeton. "First of all they reiterated the ... topline number but, more importantly, they are having a strategic review of their pharma business and people are talking about it being worth 3-4 billion pounds ($4.85-6.46 billion)." Also encouraging on the earnings front, car and plane parts maker GKN said growth in civil aviation had compensated for a sluggish military market. And Whitbread, Britain's biggest hotel and coffee shop operator, announced stronger sales helped by improving consumer demand for coffee and hotel rooms. "I think there may still be some disappointments in this quarter given what's happened in emerging markets, but generally the numbers coming out have been good and we are still fully invested and I am still pretty positive on markets," said Colin McLean, managing director at SVM Asset Management. Another top riser, global mining company BHP Billiton climbed 4.1 percent after upgrading its iron ore production target in what analysts at Morgan Stanley called a "very solid" update. ($1 = 0.6189 British pounds) (Additional reporting by Francesco Canepa; Editing by Catherine Evans) Link this Share this Digg this Email Reprints

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