By Simon Kennedy, MarketWatch
LONDON (MarketWatch) -- Britain's benchmark stock index rose
Wednesday, buoyed by strong Chinese growth data and comments from
U.S. Federal Reserve Chairman Ben Bernanke.
The FTSE 100 index gained 0.6% to end at 5,906.43. Other
European markets also closed higher.
Sentiment was boosted after Bernanke said the Fed was
contemplating more "untested" steps to stimulate growth if
conditions worsen.
Among the gainers in the FTSE were shares of British Sky
Broadcasting Group PLC . They rose 2% after News Corp. (NWSA)
announced it was withdrawing its bid to take over the firm, saying
"it has become clear that it is too difficult to progress in this
climate."
BSkyB's shares initially slumped on the news, but then traders
decided the news was already priced in, said Will Hedden, sales
trader at IG Index, in emailed comments.
The company's shares have fallen nearly 17% this month amid
concerns over the deal. Wednesday's announcement comes amid a
growing phone-hacking scandal in the U.K. involving newspapers
owned by News Corp.
"We welcome the news," said a Downing Street spokesman in an
emailed statement, responding to the BSkyB bid withdrawal. "As the
prime minister has said, the business should focus on clearing up
the mess and getting its own house in order."
News Corp. also owns MarketWatch, the publisher of this
report.
Burberry and miners
Shares of Burberry Group PLC rallied 6.5% after the fashion
house said underlying sales jumped 34% in the latest quarter,
beating analyst expectations. Comparable-store sales rose 15%
excluding China, where growth was 30%, the group said.
Seymour Pierce analyst Kate Calvert described the results as "a
faultless start to the year" and said she expects to see consensus
earnings forecasts for Burberry and price targets rise following
the results.
Miners were big climbers Wednesday as commodity prices rose and
as the latest data on Chinese economic growth came in slightly
ahead of market expectations. Silver miner Fresnillo PLC rallied
5.6%, also buoyed by rising silver prices.
Also in the sector, shares of African Barrick Gold PLC climbed
5.7% as gold prices hit a record and after the stock was upgraded
to neutral from sell at Goldman Sachs.
Marks & Spencer weighs on retail sector
Marks & Spencer (MAKSY) was the worst performer within
London's benchmark index, dropping 2.5% after reporting a 3.2%
increase in total group sales for its fiscal first quarter.
Santander analyst Rebecca McClellan said that expectations for
the retailer had been rising following a relatively strong trading
update from Debenhams PLC . However, she said the figures for Marks
& Spencer were slightly below expectations and benefited from
one-off factors, including a strong April and an early start to
sales.
"Stripping out these benefits, the trend going forward is likely
to fall into negative territory," McClellan said in a note to
clients.
Among other retailers, shares of Debenhams fell 1.5%.
Mid-cap fashion retailer Supergroup PLC bucked the trend,
surging 21% after it reported an 89% jump in underlying pretax
profit for the fiscal year.