LONDON MARKETS: FTSE 100 Heads For 1-week High As Traders Ignore Lackluster Data

By Sara Sjolin, MarketWatch Features Dow Jones Newswires

Dixons Carphone plunges as much as 32% after profit warning

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U.K. stocks advanced on Thursday, with investors appearing more confident ahead of the summit of global central bankers in Jackson Hole and shaking off downbeat data on the U.K. economy.

Meanwhile, shares in Dixons Carphone PLC (DC.LN) tumbled as much as 32% after the retailer warned on profit, citing challenges to its mobile phone business.

After a slow start to the day, the FTSE 100 index traded 0.4% higher at 7,410.37, setting it on track for its highest close in over a week.

The London benchmark moved higher even after a relatively lackluster batch of U.K. data. Second-quarter gross domestic product growth was confirmed at 0.3%, up from 0.2% in the first-quarter. However, the report also showed consumer spending slowed in the quarter "as households continue to feel the squeeze of negative real wage growth," according to Craig Erlam, senior market analyst at Oanda.

Another data set out on Thursday showed business investments in the U.K. stagnated in the second-quarter.

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"It's clear that while the economy has not nose-dived, it is suffering in the aftermath of the Brexit vote, Erlam said in a note.

"The pound fell initially after the data but quickly recovered to trade off its lows just below $1.28 against the dollar. The pair remains under pressure though and should this support break, $1.26 could be on the cards," he added.

Sterling bought $1.2825, up from around $1.2807 ahead of the data and compared with $1.2799 late Wednesday in New York. Against the euro , sterling fetched EUR1.0881, up from EUR1.0840 on Wednesday, when the U.K. currency lingered around an eight-year low.

The weak pound on Wednesday helped the FTSE close marginally higher as it offset a broader European selloff. Sterling weakness tends to boost shares of the FTSE's many multinational companies with earnings in other currencies.

In other economic news, U.K. car manufacturing rose 7.8% in July, said industry body SMMT. (https://www.smmt.co.uk/2017/08/british-car-manufacturing-rebounds-july-new-models-hit-production-lines/)

Traders were also looking ahead to the annual gathering of central bankers in Jackson Hole, Wyo., which kicks off on Thursday and runs through Saturday. European Central Bank President Mario Draghi and Federal Reserve Chairwoman Janet Yellen will speak on Friday, with markets watching for hints on the future path for monetary policy.

Read:Here's what investors will be watching when Draghi, Yellen speak at Jackson Hole (http://www.marketwatch.com/story/heres-what-investors-will-be-watching-when-draghi-yellen-speak-at-jackson-hole-2017-08-22)

Stock movers: CRH PLC (CRG.DB) (CRG.DB) climbed 3.2% after the building-materials company said it's selling its Americas Distribution business to Beacon Roofing Supply Inc. (BECN) for $2.63 billion in cash (http://www.marketwatch.com/story/crh-to-sell-us-distribution-unit-in-26b-deal-2017-08-24). Additionally, the Dublin-based company said it will buy Fels, a German lime and aggregates business, for EUR600 million.

WPP PLC (WPP.LN) (WPP.LN) inched 2% higher, after an 11% slump on Wednesday when the advertising giant issued a disappointing growth outlook.

Provident Financial PLC (PFG.LN) jumped 15%, adding to a 12% gain from Wednesday. The U.K.-based lender tumbled 66% on Tuesday (http://www.marketwatch.com/story/provident-warns-on-profit-again-ceo-to-leave-2017-08-22) after warning it will lose between 80 million pounds ($102 million) and GBP120 million in the third quarter.

On the FTSE 250 index , Dixons Carphone PLC (DC.LN) plunged 20%, but had been down as much as 32%, after the mobile phone and electrical retailer warned fiscal 2018 profit would be much lower than last year (http://www.marketwatch.com/story/dixons-carphone-warns-on-2018-profit-2017-08-24), blaming challenging conditions in the U.K. mobile phone market.

The FTSE 250 index was flat around 19,742.13.

(END) Dow Jones Newswires

August 24, 2017 07:04 ET (11:04 GMT)