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* Burberry expects annual profit to beat expectations
* Pearson raises full-year operating profit forecasts
* UK's December CPI jumps to 30-year high
* FTSE 100 up 0.4%, FTSE 250 0.0flat
(Updates to close)
By Shashank Nayar
Jan 19 (Reuters) - London's FTSE 100 ended higher on
Wednesday, aided by gains in miners and consumer staples, with
strong profit forecasts from luxury brand Burberry and education
group Pearson providing a further fillip to sentiment.
After falling as much as 0.5%%, the blue-chip FTSE 100 index
reversed course to end 0.4% higher, with major miners
and consumer companies such as Diageo and
Unilever among top gainers.
British consumer price inflation rose more than expected to
5.4% in December, official data showed, adding pressure on the
Bank of England (BoE) to raise interest rates again next month.
"The view that the current high readings are transitory is
starting to sound a bit hollow," said Alan Custis, managing
director at Lazard Asset Management. "We would expect inflation
to peak nearer 7% in 2022, which will keep the pressure on the
BoE to continue increasing interest rates."
Signs of inflationary pressures and labour market strength
drove investors to ramp up rate hike bets, pushing the UK's
benchmark bond yield to its highest since March
2019, while shorter-duration yield touched October
2018 highs.
Meanwhile, BoE Governor Andrew Bailey said that he was
concerned inflation pressures might prove longer-lasting than
previously forecast, citing surging energy costs and signs that
cost pressures are feeding into wage demands.
Burberry gained 6.3% after the luxury brand said
its annual profit would beat market expectations as the
company's full-price sales accelerated in the third quarter.
Pearson gained 4.4% after it raised its forecast
for full-year adjusted operating profit in a boost to management
efforts to restructure the business.
Meanwhile, Unilever PLC gained 4.5% after the Dove
soap maker said on Wednesday it would not increase its
50-billion-pound ($68 billion) proposal to buy GSK's
consumer healthcare business.
The domestically focussed mid-cap index was 0.0
flat, with WH Smith Plc jumping 7.1% on expectations of
a resumption in the recovery of its travel markets even as the
retailer said it was experiencing a "small impact" from the
Omicron coronavirus variant.
(Reporting by Shashank Nayar and Amal S in Bengaluru; Editing
by Shounak Dasgupta, Subhranshu Sahu, William Maclean)
