Britain's Stocks Benchmark Close to Recouping Its Late-January Losses

(Bloomberg) -- The FTSE 100 Index is close to recouping all its late-January losses as a large exposure to so-called value stocks as well as oil companies and banks lifts the U.K. benchmark.

The gauge rose as much as 0.9% to 7,605 points on Wednesday, leaving it a whisker away from the intraday peak reached Jan. 20 before concern around central bank policy tightening and geopolitical risk from Russia-Ukraine tensions roiled markets.

While most global benchmarks have trimmed declines, the FTSE 100's recovery has been more pronounced thanks to its higher make-up of cheaper, so-called value shares rather than growth sectors like technology. When interest rates rise, future earnings are discounted back more severely, making tech and other growth equities less desirable. 

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The British benchmark has also benefited from Brent crude's march above $90 a barrel, lifting stocks like Royal Dutch Shell Plc and BP Plc. Lenders including Barclays Plc and Lloyds Banking Group Plc are set to reap the benefits of higher Bank of England rates, with policymakers seen hiking again on Thursday.

Upside for the FTSE 100 “looks particularly attractive versus the S&P 500,” Goldman Sachs Group Inc. strategists including Christian Mueller-Glissmann wrote in a note on Monday.

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