By Shashwat Chauhan
(Reuters) -UK shares climbed higher on Friday as gains in Rolls-Royce boosted aerospace stocks and higher oil prices lifted energy giants, with investors looking ahead to U.S. personal consumption data due later in the day.
The blue-chip FTSE 100 gained 0.3%, but was on track to post its biggest weekly decline in five weeks.
Rolls-Royce extended its previous day’s gains, rising 5.3%, pushing the aerospace and defence sector up 2.0% after the jet engine maker beat profit forecasts on Thursday and raised expectations for 2023.
Energy majors Shell and BP both rose 1.4% each on higher oil prices.
British Airways-owner IAG fell 3.9% to the bottom of the FTSE 100 following its full-year results and saying it bought the remaining 80% of Spain’s Globalia for 400 million euros ($423.84 million).
Analysts were also waiting for the latest reading on U.S. core personal consumption expenditure, which is expected to rise 0.4% for the month of January, according to a Reuters poll.
“The market will wake up to the fact that the Fed funds rate will have to stay long higher for longer instead of being calculated this year,” said Janet Mui, head of market analysis at RBC Brewin Dolphin.
The FTSE 100 has had a great start to the year so far, recording multiple record highs on its journey above the 8,000 points mark as some positive earnings and higher commodity prices have helped the index outperform U.S. counterparts.
Market research firm GfK said British consumers have turned more upbeat about their personal finances and the outlook for the economy but their mood remains a long way off pre-pandemic levels.
The more domestically-inclined FTSE 250 midcap index rose 0.4%, as shares of asset manager Jupiter Fund Management surged 11.1% after beating full-year profit expectations.
(Reporting by Shashwat Chauhan in Bengaluru; Editing by Rashmi Aich, Nivedita Bhattacharjee)