London - Britain's top shares rose to five-month highs on Wednesday on positive earnings releases from firms including retailer Next and lender Barclays.
Britain's second-biggest clothing retailer rose 6.2 percent, the biggest FTSE 100 gainer by some margin, after edging up its 2013 profit guidance as third-quarter sales came in a touch above expectations.
Barclays advanced 2.9 percent after after underlying pretax profits beat forecasts.
Around 53 percent of companies on the pan-European STOXX 600 index that have reported so far have beaten or met market expectations with their results, Thomson Reuters Starmine data showed.
The FTSE 100 was up 31.68 points, or 0.5 percent, at 6,806.41 points by 10:40 SA time, notching up its fifth successive day of gains and hitting its highest levels since May as investors awaited a policy statement from the US Federal Reserve expected to spell out that its ultra-loose monetary remains unchanged.
The fact that the US economy has been experiencing muted growth has convinced many in the market that the Fed will delay trimming its stimulus spending, which has underpinned equities for months, into next year.
“It seems it will be March or even potentially April that QE (quantitative easing) will start to be tapered... and if you put that together with stronger-than-expected corporate earnings, you've got a cocktail for improvement (on equity markets),” said Richard Hunter, head of equities at Hargreaves Lansdown.
While some analysts are mindful of potential for surprises when the Fed publishes its statement at 20:00 South African time after a two-day meeting, many reckon the recent rally in equities has largely factored in an unchanged monetary policy.
Craig Erlam, analyst at Alpari, was bullish on prospects for the FTSE 100 but said it could struggle to pass 6,838, a previous level of resistance, and then 6,875, the 2013 high.
“Above here we have the all-time high of 6,950.60, a level I see the FTSE surpassing before the end of the year unless the Fed tapers before then,” he said. - Reuters