Insurance firms and GlaxoSmithKline results boost FTSE

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Last Updated at 20 Oct 2017, 15:21 GMT *Chart shows local time FTSE 100 intraday chart
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(Close): The London market closed higher boosted by better-than-expected results from drugs giant GlaxoSmithKline and a sharp rise in insurance firm shares.

The benchmark FTSE 100 index closed up 27.4 points at 6,399.73.

Shares in Glaxo jumped 2.6% after its core earnings per share of 27.9p, beat analysts' forecasts.

Motoring group AA said the price of car insurance had risen for the first time since early 2012 boosting insurers.

Admiral was the top riser on the FTSE 100, jumping 3.4%, while Direct Line, the UK's largest car insurer, gained 3.1% and esure Group rose 5.9%.

BAT shares fell 2.6% to 3,375p after it posted a 9.6% drop in revenues for the first nine months of the year. The company has been hit by currency movements and weak economic growth in Europe.

Outside the FTSE 100, shares in Home Retail Group were initially hit as it reported a 5% drop in half-year profits to £13.5m and said it would cut the number of Homebase stores by a quarter by 2018.

Home Retail Group's shares dived 6% at first, before recovering to close 2.3% higher.

Shares in Supergroup - the company behind the Superdry fashion brand - fell 5.3% to 975p. The company announced that the former Co-operative Group boss Euan Sutherland would become its new chief executive.

Mr Sutherland is replacing founder Julian Dunkerton, who will be taking up a new position as product and brand director.

On the currency markets, the pound weakened after the release of minutes from the latest Bank of England meeting.

Analysts said the minutes indicated that the Bank's Monetary Policy Committee is some way off voting for any rate rise, with most observers now not expecting an increase until the second half of 2015.

The pound fell 0.3% against the dollar to $1.6068 and but rose 0.2% against the euro at 1.2694 euros.


"Pricing power is not common in a low-growth world, so any

industry that displays it is likely to attract investor

interest," Robert Parkes, director of equity strategy at HSBC,


"This appears to be the case for insurance. The sector is

being well supported by positive earnings momentum and a premium


The FTSE 100 finished 0.4 percent higher at 6,399.73 points.

It had fallen more than 10 percent in four weeks before making a

marginal recovery since late last week.

Gains were partly offset by a fall in British American

Tobacco after a trading update.

BAT was down 2.6 percent after the maker of Pall Mall and

Dunhill cigarettes said the trading environment remains

challenging because of pressure on consumer disposable income

worldwide, currency issues and a slow economic recovery in

western Europe.

"Any company that has been operating globally, particularly

in emerging markets, has been facing currency headwinds," David

Battersby, investment manager at Redmayne-Bentley, said.

Retail stocks also fell on industry data showing sales at

Tesco had declined in the last 12 weeks. Tesco,

Sainsbury's and Morrisons fell in the range of

1.6 percent to 3.4 percent.

The mid-cap FTSE 250 index rose 1 percent, boosted

by a bullish update by gambling technology business Playtech

and bid speculation surrounding speciality chemicals

maker Croda International.

Croda rose 5.8 percent, adding to a 1.8 percent gain on

Tuesday, which the Daily Mail and Daily Express newspapers

attributed to talk of a 4 billion pound ($6.5 billion) offer for

the company.

Playtech surged 5.1 percent after saying it was confident it

would exceed current market expectations after a strong start to

its fourth quarter, which followed a 29 percent rise in revenue

in the preceding period.