FTSE hovers close to April record highs

Britain’s top share index hovered just below last month’s record highs on Thursday, with supermarket retailer Tesco outperforming on the prospect of a possible South Korean unit sale.

The blue-chip FTSE 100 index was flat at 7,008.43 points in early session trading, leaving it 1.6 per cent below a record high of 7,122.74 points reached in April. The FTSE remains up by around 7 per cent since the start of 2015.

“We stand by 7,100 points as a near-term target for the FTSE. We are still buyers of this market,’’ said Thames Capital Markets’ trader Gerren O'Neill.

Tesco rose 1.3 per cent, making it one of the best-performing FTSE stocks, following a media report that it would start the sales process for its South Korea unit in July. A Tesco spokesman said the company had no comment to make on the media speculation.

Mining stocks such as BHP Billiton and Rio Tinto also progressed as traders speculated that yet more weak data from China — the world’s biggest metals consumer — would lead Beijing to launch further measures to boost its economy.

China’s central bank is widely expected to cut interest rates further in coming months, on top of three reductions since November, and may also lower banks’ reserve requirements again to reduce companies’ borrowing costs and encourage more lending.

However, luxury goods group Burberry fell 1.6 per cent as several brokers reduced their price targets on the company’s shares. Burberry shares had slumped by 5 percent on Wednesday after the company cut its 2016 profit guidance.