By Darshan Kumar R
Oct 15 (Reuters) - London's blue-chip stocks closed at a seven-week high on Thursday after the finance minister reaffirmed the government's commitment to fiscal discipline, while a shift into defensive sectors amid a deepening global selloff in AI-related stocks also supported the benchmark.
The benchmark FTSE 100 index closed higher by 1.1% to 10,840.35 points, its highest since August 26, while the midcap FTSE 250 also rose 0.26%.
• Investors sought refuge in defensive sectors as
a global chip stocks selloff intensified, benefiting UK's large caps with limited exposure to AI
• "It's a rotation towards long-term; almost an infrastructure play without the risk of a rate increase and healthcare, consumer cyclicals are a safer heaven as they are not overly leveraged," said Nick Saunders, CEO of Webull UK
• Drugmakers AstraZeneca and GSK climbed 3.2% and 2.9%, respectively
• Dove soap maker Unilever rose 1.8% and cigarette maker British American Tobacco advanced 2.5%
• British finance minister John Healey said this month's budget would aim at bolstering economic resilience, adding that he and Prime Minister Andy Burnham were aligned on maintaining fiscal discipline
• Financials, including heavily weighted banks, was up 0.3%
• UK's gross domestic product rose 0.1% in August, boosted by AI optimism, against expectations of a 0.1% drop
• Bank of England Chief Economist Huw Pill said that any future interest rate increase should not be interpreted by investors as the start of a prolonged series of rate hikes
• Economists polled by Reuters expect the BoE to raise rates to 4% in November
• Industrial metal miners were down 1.4%, on weaker copper prices
• Antofagasta fell 4.1%, after the Chilean miner's third-quarter copper production declined year-on-year
• E-commerce group THG surged 16.3% after lifting its annual profit forecast
• Paper and packaging firm Mondi slumped 7.9% after hiking prices for several paper grades to offset higher energy costs
(Reporting by Darshan Kumar in Bengaluru; Editing by Vijay Kishore and Shailesh Kuber)
