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Semiconductor industry

U.K. Stocks Reach 22-Month High Amid Positives from Intel and BT Group

Strategic Insights

— 2 min read

U.K. shares have surged to a 22-month high, driven by Intel's sales forecast and BT Group's earnings beating analyst estimates. BT Group, the U.K.'s biggest phone company, rallied 4.4% as Morgan Stanley noted it's trading at a discount to U.S. rivals. Xstrata, Kazakhmys, and Rio Tinto advanced as base metals gained, while Burberry Group rallied 2.4% on French rival Christian Dior's higher revenue. The FTSE 100 Index climbed 46.42, or 0.8%, to 5,808.08, with the FTSE All-Share Index and Ireland's ISEQ Index also showing gains.

Key Takeaways:

  • Intel's sales forecast and record profit margins contributed to the rally, with investors taking strong sales as reassurance of economic recovery driven by business expansion and consumer appetite.
  • BT Group's 4.1% advance was the steepest in seven months, driven by Morgan Stanley's analysis that it's trading at a discount to U.S. competitors and has used more prudent assumptions in its cash-flow forecasts.
  • Vodafone Group, Xstrata, Kazakhmys, and Rio Tinto also showed significant gains, with Xstrata's 2.6% advance and Kazakhmys' 2.5% increase contributing to the overall uplift.
  • New Hope Corp.'s revised all-share offer for Macarthur Coal Ltd. includes A$950 million in cash, joining Xstrata's potential A$4 billion bid in the battle for the Brisbane-based producer.
  • Burberry Group's 2.6% rally was driven by Christian Dior's higher revenue, highlighting the positive impact of French luxury retailers on U.K. shares.

Statistics:

  • Intel's forecast indicators: 1.21 billion (forecast) < 1.82 billion (previous year)
  • BT Group's earnings: 55% rise in first-quarter earnings, beating analyst estimates
  • FTSE 100 Index: 5,808.08 (previous high)
  • U.K. shares: 22-month high
  • Xstrata's share price: 1,294 pence (increased 2.6%)
  • Kazakhmys' share price: 1,565 pence (increased 2.5%)
  • Vodafone Group's share price: 150.5 pence (increased 1.2%)

Sources:

  • "U.K. stocks climb to 22-month high after Intel and JPMorgan results" - Bloomberg (via Euclid Infotech Pvt. Ltd.)
  • "Intel's forecast beats estimates, sending shares up 1.2% in U.S. trading" - The Wall Street Journal (via Euclid Infotech Pvt. Ltd.)
  • "BT Group shares surge 4.4% as Morgan Stanley says it's trading at a discount to US rivals" - The Financial Times (via Euclid Infotech Pvt. Ltd.)
  • "Xstrata may bid A$4 billion for Macarthur Coal" - The Australian newspaper (via Euclid Infotech Pvt. Ltd.)

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