FTSE 100 hits two-week high, Kingfisher surges

By Khushi Singh and Lisa Pauline Mattackal

(Reuters) -The FTSE 100 rose to a two-week high on Tuesday, lifted by a rise in retailer and personal goods shares, while investors prepared for central bank meetings through the week.

The blue-chip index FTSE 100 rose 0.4%, while the mid-cap FTSE 250 edged up by 0.1%. Both indexes marked their fourth consecutive session of gains.

Kingfisher was the biggest gainer on FTSE 100, adding 11.2% after the home improvement retailer lifted the bottom end of its annual profit outlook, saying that seasonal sales trends have improved since early July.

The broader retailers index touched its highest levels since January 2022, up 2.8%.

The personal goods index gained 2.8%, its biggest one-day jump in nearly eight weeks, as sectoral heavyweights Burberry and Watches of Switzerland Group advanced 3.1% each.

On the downside, aerospace and defence stocks led sectoral declines with a 2.2% slip, as report showed some of Ukraine's allies are starting to talk about how a negotiated end to the conflict could take shape.

Bae Systems slumped 4.7% to the bottom of FTSE 100.

A gauge of European aerospace and defence stocks lost 1.8%.

With all eyes on the Federal Reserve's expected first interest rate cut on Wednesday, traders lifted the chances of a larger-than-usual 50-basis-point reduction to 67%, as per the CME's FedWatch tool.

The Bank of England also meets this week. Analysts largely expect policymakers to leave rates on hold, so investors will primarily watch for clues on the BoE's path for the rest of the year and updates on the pace of its bond sales.

Shares of Essentra slumped 15.2% after the plastic and metal components supplier warned that annual operating profit could miss market expectations due to weaker conditions in Europe and slower recovery in the Americas.

Shares of e-commerce firm THG slipped 12.4% after the company said it was actively looking to facilitate the demerger of its technology services arm.

(Reporting by Khushi Singh, Lisa Mattackal in Bengaluru; Editing by Sonia Cheema and Nick Zieminski)