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UK stocks edge higher, cybersecurity firm Darktrace soars on forecast lift

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By Reuters
London stocks rebound, cybersecurity firm Darktrace soars on upbeat outlook
London stocks rebound, cybersecurity firm Darktrace soars on upbeat outlook   -   Copyright  Thomson Reuters 2022

By Shashank Nayar

-London’s blue-chip index rose on Tuesday, as global equities paused after a recent sell-off on concerns about tighter monetary policies, while midcap stocks bounced off near three-week lows with cybersecurity firm Darktrace in the lead.

The internationally focussed FTSE 100 rose 0.4%, still lagging a 1% gain for its European peers such as Germany’s DAX and France’s CAC 40 that have been hit hard recently due to a bigger exposure to technology firms. [.EU]

“UK’s market is less exposed to tech stocks and with the sector inherently being more volatile given their nature, taking that away from the FTSE 100 gives it a more stable personality right now,” said Stuart Cole, head macro economist at Equiti Capital.

“We have the Bank of England and its willingness to further tighten policies following its December hike … there is a sense that monetary normalisation is on the cards.”

Investors have increased bets of an interest rate hike as early as next month after the Bank of England surprised with a rate hike in December. Rate-sensitive banks have outperformed with a near 10% gain so far in 2022.

Gaming companies Entain and Flutter rose more than 3% after Citigroup published bullish views on the sector amid prospects for U.S. regulation of online sports betting.

Robert Walters rose 1.2% after the recruitment firm forecast annual profit to exceed current expectations and posted higher net fees as it benefited from businesses ramping up hiring.

The FTSE 250 mid-cap index climbed 0.6% after sinking to its lowest since Dec. 22 in the previous session.

Leading gains on the index, Darktrace surged 17.1% after raising its full-year outlook for revenue and earnings margin following strong customer growth and retention in the first half of the year.

Marks & Spencer rose 2.3% after data from market researcher NielsenIQ showed it was Britain’s fastest growing food retailer in the Christmas quarter.