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Investors snapped up the shares of domestically focused UK companies ahead of Rishi Sunak’s Budget on Wednesday as they banked on the chancellor extending government support for the leisure and retail sectors, furloughed workers and Universal Credit claimants.
In the FTSE 100, shares in Premier Inn hotel operator Whitbread traded almost 5 per cent higher on Wednesday morning while housebuilder Persimmon added more than 4 per cent and lender Barclays rose 3.7 per cent. The blue-chip share index was up more than 1 per cent overall, led by consumer cyclicals stocks.
The more domestically focused FTSE 250 mid-cap index had gained just under 1.7 per cent by mid-morning on Wednesday, with Cineworld and transport operator First Group among its top performers.
“You’ve got a really good combination here of strong support for sectors such as retail and leisure to see them through until the economy reopens, and households sitting on record amounts of savings that they can go out and spend,†said Randeep Somel, portfolio manager at investment group M&G.
Sterling added almost 0.2 per cent against the dollar to purchase just under $1.40, although UK government bonds remained out of favour as investors anticipated a rise in state borrowing. The yield on the benchmark 10-year gilt, which moves inversely to the price of the debt security, added 0.06 percentage points to just under 0.75 per cent.
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