Oil and tobacco give FTSE 100 a boost
* FTSE 100 up 0.55 pct
* SSE drops after profit warning, hits utilities
* BAT, Imperial Brands rise after FDA's e-cig move
* Midcaps Dunelm, Galliford rise after updates
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By Danilo Masoni
MILAN, Sept 12 (Reuters) - Stronger crude prices and a rally
in tobacco stocks gave a boost to Britain's top share index on
Wednesday, while a profit warning hit energy provider SSE.
The FTSE 100 ended up 0.55 percent at 7,313.36
points, having hit its lowest point in five months in the
The internationally-exposed index has lost ground in recent
weeks as the pound strengthened, on the back of growing optimism
over a Brexit deal, and worries over trade and emerging markets
kept investors wary.
However, sterling saw some weakness on Wednesday on reports
of a potential challenge to Prime Minister Theresa May.
BP and Shell rose 1.6 percent and 1 percent
respectively, after Brent prices reached $80 following a
larger-than-expected drop in U.S. crude inventories and as
sanctions on Iran added to concerns over global oil supply.
SSE tumbled 8.3 percent to its lowest since February
2011 after it warned first-half profit would halve due to the
impact of dry, still and warm weather, and persistently high gas
"It is very rare to see a profit warning from a utility
company as they are meant to have fairly predictable income
streams ... Ultimately it is a good reminder that even seemingly
defensive companies still have operational and regulatory
risks," said Russ Mould, investment director at AJ Bell.
The SSE warning weighed on other utilities.
Tobacco stocks were in focus after the U.S. Food and Drug
Administration said it was considering a ban on flavoured
e-cigarettes in response to an "epidemic" of young people using
After the news, BAT and Imperial Brands
turned higher to end up 5.8 and 3.2 percent respectively.
The FDA's leader announced a number of steps the agency
planned to take as part of a broader crackdown on the sale and
marketing of e-cigarettes to kids.
Traders said the action was not as harsh as feared.
Among mid-caps, furniture retailer Dunelm Group
reported flat annual profits after taking an 8.9 million pound
charge in its efforts to complete the integration of loss-making
internet business Worldstores. Its shares rose 11.8 percent.
"With forecasts held, stable trading, an acceleration in
store openings to 10 stores for the year ahead, a reasonable
showing from the new CEO may well yield some positive momentum
in the share price," said Peel Hunt analysts.
Construction company Galliford Try rose 10.5
percent after its full-year pretax profit jumped 145 percent. It
also confirmed its 2021 strategic targets.
(Reporting by Danilo Masoni; Editing by Alexander Smith and
First Published: 2018-09-12 11:32:47
Updated 2018-09-12 18:33:46
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