London stocks end higher on optimism over swift economic recovery

By Shivani Kumaresan and Amal S

(Reuters) -British shares ended higher on Thursday ahead of a long weekend, as hopes of a swifter economic rebound this year boosted sentiment, while Quilter rose after agreeing to sell its international business to Utmost Group.

The blue-chip FTSE 100 index ended 0.4% higher, with industrials and consumer discretionary stocks, mainly Ferguson PLC, Melrose Industries PLC, International Consolidated Airlines Group, Compass Group plc being the biggest gainers.

Bank stocks, including Prudential Financial Inc, Barclays Plc, Lloyds Banking Group, were also among the biggest boosts on the index.

"It seems investors are very much of the mind that it is still worth backing companies that will benefit from the reopening of the global economy, despite the negative backdrop of France closing schools in its third lockdown and Brazil still struggling to get Covid under control," said Russ Mould, investment director at AJ Bell.

Global equities gained following their slowest quarter in a year, on hopes of a stronger U.S. economy, as investors parsed details of a $2 trillion government spending plan and hoped for strong jobs data later in the week. [MKTS/GLOB]

The FTSE 100 has risen 4.3% so far this year, supported by speedy vaccine rollouts and a raft of economic stimulus. But a recent spike in virus cases across Europe has made investors cautious.

Meanwhile, defensive plays including consumer staples, and healthcare were the biggest drags on the index.

Quilter rose 4.3%, after it agreed to sell its international business to specialist life assurance company Utmost Group for 483 million pounds ($664.37 million), as it sharpens its focus on its UK wealth management unit.

The domestically focused mid-cap FTSE 250 index climbed 1%, led by industrials and consumer discretionary stocks.

Fashion retailer Next rose 3.2%, even after it reported a halving in annual pretax profit after lockdowns closed its stores but raised its forecast for a big rebound this year.

(Reporting by Shivani Kumaresan and Amal S in Bengaluru; Editing by Shailesh Kuber and Mark Heinrich)