LONDON MARKETS: FTSE 100 Ends Higher, Led By EasyJet's Jump

A higher divorce payment from the U.K. might unclog the Brexit process

British blue-chip stocks ended higher Tuesday, with EasyJet PLC helping to lead the way up as investors assessed a round of corporate financial updates.

The lift came as major U.S. stock gauges rallied (http://www.marketwatch.com/story/nasdaq-shapes-up-for-another-record-with-retail-earnings-on-deck-2017-11-21), with a leap in technology shares pushing the Nasdaq Composite Index to an all-time high.

The pound was little changed, surrendering an earlier gain that came amid hopes that a higher divorce payment from the U.K. will unclog the Brexit process.

What markets are doing: The FTSE 100 index rose 0.3% to close at 7,411.34, adding to Monday's rise of 0.1% (http://www.marketwatch.com/story/ftse-100-slips-to-around-2-week-low-as-pound-rises-2017-11-20) .

The pound traded at $1.3230, roughly unchanged from $1.3233 late Monday in New York.

What's moving markets: Sterling initially held to higher ground after media reports that U.K. Prime Minister Theresa May's cabinet has agreed to increase the amount the U.K. is willing to pay the EU (https://www.theguardian.com/politics/2017/nov/20/theresa-mays-cabinet-agrees-to-pay-more-to-break-brexit-deadlock) on its exit from the bloc. The new "divorce bill" offer could be GBP40 billion ($53 billion) -- twice as much as previously suggested, some reports said.

While the higher offer would require more EU concessions in return, it was being cheered as having the potential to spur the languishing Brexit talks back to life.

Economic docket: U.K. public sector borrowing rose (http://www.marketwatch.com/story/uk-public-borrowing-increases-in-october-2017-11-21) to GBP8.0 billion in October, up GBP0.5 billion from year ago, the Office for National Statistics said.

Investors will assess that reading as they wait for Chancellor Philip Hammond to present his budget for the U.K. on Wednesday.

Members of the Bank of England -- Jon Cunliffe, Ian McCafferty, Michael Saunders and Gertjan Vlieghe -- will appear before the Treasury Select Committee to discuss the central bank's November Inflation Report at 10 a.m. London time, or 5 a.m. Eastern Time.

What strategists are saying: For the FTSE 100, the "near-term outlook remains somewhat unclear although it seems reasonable to assert that a close below 7,350 will represent a significant technical development that would likely be followed by further weakness," wrote Bill McNamara, who runs The Technical Trader daily newsletter.

"The U.K. budget is due tomorrow. Chancellor Philip Hammond is expected to remain cautious on the budget, especially if the U.K. prepares to loosen its purse string to quit the EU in a friendly manner," said Ipek Ozkardeskaya, senior market analyst at London Capital Group.

"Of course, the UK's offer may fall short of the EU's demand. The downside risks prevail, and [pound] resistance could be found at 1.3280-1.3300 area," Ozkardeskaya said in a note.

Stock movers: EasyJet (EZJ.LN) shares bounced up 5.1% after the low-cost airline said passenger traffic rose 10% in fiscal 2017 (http://www.marketwatch.com/story/easyjet-net-profit-down-24-passenger-traffic-up-2017-11-21) and that forward bookings for the first quarter of 2018 are ahead of last year. Net profit for the full year fell 24% to GBP325 million ($430 million). The stock was the FTSE 100's biggest gainer.

Kingfisher PLC (KGF.LN) rose 1.4% even after the DIY retailer said like-for-like group sales fell 0.5% (http://www.marketwatch.com/story/kingfisher-sales-fall-but-sticks-with-profit-view-2017-11-21) in the third quarter, reflecting continued weak sales in France. HSBC analysts backed their buy rating on the stock after the results, saying it looks cheap and the downside risk is limited, according to a Dow Jones Newswires report.

Compass Group PLC (CPG.LN) dropped 3.3%. The move came after the catering-services provider said pretax full-year profit rose 18% (http://www.marketwatch.com/story/compass-profit-up-buoyed-by-n-america-business-2017-11-21), bolstered by its North America business and the pound's slump.

(END) Dow Jones Newswires

November 21, 2017 12:19 ET (17:19 GMT)