By Sarah Jones
Oct. 21 (Bloomberg) -- U.K. stocks advanced for a second day this week, led by retailers as Nomura Holdings Inc. recommended shares of Tesco Plc and a report said Qatar may raise its stake in J Sainsbury Plc.
Tesco rallied the most in three months as Nomura raised its price estimate on Britain’s largest retailer 30 percent, citing prospects for increased profitability and foreign sales. Sainsbury gained 1.8 percent after the Financial Times reported Qatar Holding LLC may lift its 26 percent stake. Wolseley Plc climbed as BofA Merrill Lynch Global Research upgraded the heating and plumbing gear supplier to “buy.”
The FTSE 100 Index gained 15.67, or 0.3 percent, to 5,259.07 at 9:02 a.m. in London, paring some of yesterday’s 0.7 percent retreat. The FTSE All-Share Index rose 0.3 percent and Ireland’s ISEQ Index added 0.4 percent.
Tesco increased 2.3 percent to 392.20. Nomura raised its price estimate for the shares 30 percent to 526 pence. The retailer is a “disciplined, defensive, sustainable growth story that is significantly undervalued by the market,” analysts including Matthew Truman wrote in an e-mailed note. Services like banking will drive Tesco’s British growth as the grocery market matures, they said.
Sainsbury gained 1.8 percent to 353.9 pence. The Financial Times said Qatar Holding, the direct investment unit of the Qatar Investment Authority, may raise its stake in the U.K. supermarket chain. The newspaper did not say where it got the information.
Sainsbury rallied 5.4 percent yesterday after Qatar sold shares in Barclays Plc, stoking speculation the emirate may make a new bid for the retailer.
Wolseley climbed 3.2 percent to 1,459 pence, the best performer on the benchmark FTSE 100. BofA Merrill Lynch raised its recommendation on the stock to “buy” from “underperform,” saying “positive GDP growth should drive operational leverage.”
To contact the reporter on this story: Sarah Jones in London at sjones35@bloomberg.net.
Posts
No comments:
Post a Comment