UKX FTSE 100 Index

By Carla Mozee and Sara Sjolin, MarketWatch

Benchmark scores 4th straight win; Shire falls as Allergan rules out bid

U.K. stocks advanced for a fourth straight day on Friday, closing at the highest level in about 11 weeks, partly prompted by a drop in the pound after Bank of England Gov. Mark Carney suggested that an interest-rate increase may not come as soon as expected.

How markets are moving

The FTSE 100 index rose 0.5% to end at 7,368.17, scoring its highest close since Feb. 2 according to FactSet data.

For the week, the blue-chip stock gauge rose 1.4%, marking a fourth straight weekly advance.

The pound traded at $1.4030, down from $1.4082 late Thursday in New York. Against the euro, sterling bought EUR1.1390, down from EUR1.1408 in the prior session.

Read:Here's why the pound got whipped this week--and why it may bounce back to $1.44 (http://www.marketwatch.com/story/heres-why-the-pound-got-whipped-this-week-and-why-it-may-bounce-back-to-144-2018-04-20)

What's driving the markets

The pound was a major factor driving the FTSE 100's direction. Sterling dropped below $1.41 late Thursday after Carney dampened expectations for an interest rate rise next month.

A weaker pound can help lift the British blue-chip index, as its multinational companies generate most of their sales in foreign currencies.

In an interview with the BBC (http://www.bbc.co.uk/news/business-43831159), Carney said a rate hike is "likely" this year, but said he didn't "want to get too focused on the precise timing," citing uncertainty over Brexit and recent disappointing retail and inflation data. The market had been pricing in a rate increase at the BOE's meeting on May 10.

(http://www.marketwatch.com/story/heres-why-the-pound-got-whipped-this-week-and-why-it-may-bounce-back-to-144-2018-04-20)In a rebuke to Carney's dovish comments, BOE member Michael Saunders in a speech on Friday reminded traders that there is still a need for further tightening (http://www.marketwatch.com/story/boes-saunders-sees-need-for-further-rate-hikes-2018-04-20) to keep inflation in check.

What are strategists saying?

"It's being reported that the EU is set to reject Britain's proposed solution to the Irish border conundrum, leaving U.K. Prime Minister Theresa May between the rock of the EU and the hard place of a compromise unacceptable to the 'Leave' faction in the U.K.," said Marshall Gittler, chief strategist at ACLS Global, in a note.

"So the 'Goldilocks' scenario of rising interest rates and falling Brexit tensions, which has pushed [the pound] up to its post-Brexit high, is now collapsing, leaving GBP exposed," he added.

Stocks in focus

Among multinationals, shares of drugmaker GlaxoSmith Kline PLC (GSK.LN) (GSK.LN) added 1.6%, and British American Tobacco PLC (BATS.LN) picked up 1.4%.

Reckitt Benckiser Group PLC shares (RB.LN) dropped 2.8%. First-quarter like-for-like sales growth at the consumer products maker came in (http://www.marketwatch.com/story/reckitt-benckiser-sales-rise-backs-yearly-view-2018-04-20) at 2%, falling short of expectations for 2.6% growth.

Shire PLC (SHPG) (SHPG) shares fell 3.9% after Allergan PLC (AGN) late Thursday said it doesn't plan to make a bid for the Dublin-based drugmaker (http://www.marketwatch.com/story/blink-and-you-missed-it-allergan-doesnt-plan-to-make-a-shire-bid-2018-04-19). Meanwhile, Japan's Takeda Pharmaceutical Co. said Friday it had sweetened its offer to buy Shire (http://www.marketwatch.com/story/takeda-sweetens-bid-for-drug-rival-shire-2018-04-20), just a day after the British drugmaker rejected a bid from the rival pharma company.

Among biggest advancers, Mediclinic International PLC (MDC.LN) shares rose 2.4%, and building materials supplier CRH PLC moved up 4.1%.

Barclays PLC (BCS) said British regulators have proposed fining its Chief Executive Jes Staley (http://www.marketwatch.com/story/barclays-ceo-jes-staley-fined-but-keeps-job-2018-04-20), after an investigation into his attempt to identify a whistleblower. But the bank said the CEO will keep his job. Shares ended up 0.6%.

(END) Dow Jones Newswires

April 20, 2018 12:00 ET (16:00 GMT)

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