FTSE 100 watch: Trump tax promise and UK manufacturing data prop up Footsie

on Feb 10, 2017

The UK benchmark index has gained ground in today’s session, finding support in an upbeat US lead after President Donald Trump signalled he would unveil a ‘phenomenal’ tax plan, as well as strong manufacturing data at home. Reckitt Benckiser (LON:RB) meanwhile is underperforming the FTSE 100 after updating investors on its performance and unveiling that it had inked a deal to buy baby formula maker Mead Johnson.

As of 12:31 GMT, Britain’s blue-chip index had added 20.49 points to stand 0.28 percent higher at 7,249.99.
“The market seems keen to build on yesterday’s last minute growth, investors’ interest piqued by Donald Trump’s promise, written in his typically presidential style, of ‘something phenomenal in terms of tax’ in the next few weeks,” Connor Campbell at Spreadex commented in a morning note.

The Footsie has also found support in data which showed that British manufacturing had grown more strongly than expected in December.
“There is plenty to be cheery about UK plc. Industrial production growth hit a six-year high in the final month of 2016,” Neil Wilson, analyst at ETX Capital, told Reuters. “Today’s data confirm that the UK economy remains very resilient and lends support to the Bank of England’s decision to revise up its 2017 growth outlook.”

In individual movers, Reckitt Benckiser’s share price has retreated 0.91 percent to 7,173.00p after the Nurofen maker announced that it had inked a deal to buy Mead Johnson for $16.6 billion. Reuters quoted Steve Clayton, manager of the HL Select UK Shares fund at Hargreaves Lansdown, which owns shares in the FTSE 100 group, as saying that Mead’s poor performance was a risk. Clayton, however, added that “building brands and raising performance is stock-in-trade for RB, and the growth potential for infant milk sales is exciting, especially in the emerging markets”.
**The FTSE 100 index was 0.33 percent up at 7,253.46 points as of 12:38 GMT on Friday, 10 February 2017.**

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