FTSE 100 watch: Weaker pound and strong US lead lift Footsie

Pearson rallies as investors digest latest update

FTSE 100 watch: Weaker pound and strong US lead lift Footsie

The UK benchmark index has climbed marginally higher in today’s session, finding support in a weaker pound and following a strong lead from the US where investor attention turned to corporate earnings. In individual FTSE 100 movers, Pearson (LON:PSON) is outperforming the market after reiterating its full-year profit forecast.

FTSE 100 inches higher

As of 12:24 BST, the Footsie had added 14.77 points to stand 0.21 percent higher at 7,074.17. The blue-chip index has benefited from a fall in the pound, which has retreated on the back of weaker-than-expected inflation data. An upbeat lead from the US where shares rose last night boosted by strong corporate earnings has also helped investor sentiment.

“The buyers have returned, drawn by the bargains on offer across equity markets after last week’s sell-off,” Chris Beauchamp, market analyst at IG, commented in a note, adding that a close of the FTSE 100 above the 7,080-point level, “which has marked the limit of gains over the past few sessions, would send a signal that the buyers are in control”.

“Dips below 7,000 have continued to find buyers, so any weakness may see fresh support around here,” he continued, adding that above 7,080 points, “7,127 and then 7,200 are upside targets”.

Pearson shares in demand

In individual stock news, shares in Pearson have added 2.74 percent to 839.80p, after the blue-chip publisher reiterated that it was on track to return to profit growth this year, despite a drop in US revenue. Reuters reports that Pearson  is a widely shorted stock, and the amount of shares out on loan has risen this year, according to data from FIS Astec Analytics.

The FTSE 100 was 0.24 percent up at 7,076.42 points as of 12:42 BST on Wednesday, 17 October 2018.

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