- Oil majors BP and Shell slip as oil prices fall
- UK PM to make his first speech of 2023
- FTSE 100 up 0.2%, FTSE 250 adds 0.9%
Jan 4 (Reuters) - UK's main stock indexes rose on Wednesday as hopes of a rebound in China's economy brightened the global mood, while investors awaited minutes from the U.S. Federal Reserve's policy meeting to gauge the path forward for interest rates.
The exporter-heavy FTSE 100 rose 0.2%, while the more domestically focused FTSE 250 gained 0.9%.
Shares of China-exposed stocks such as luxury goods maker Burberry, bank HSBC and insurer Prudential rose between 1.1% and 3.1% as investors bet the dismantling of China's zero-COVID policy will boost economic growth.
Focus now will be on minutes from the Fed's meeting in December, when the central bank shifted to a smaller 50-basis point rate hike, but cautioned rates may need to remain higher for longer.
"It is going to be key in the meeting minutes today to see how the decision of the 50 basis points came," said Daniela Hathorn, senior market analyst at Capital.com.
"Is it because they think the economy is starting to show signs of cooling or is it because they think 'let's just take a step back to see how these rate hikes have impacted the economy'."
While global equities tanked last year, largely on worries about tighter monetary conditions, the FTSE 100 outperformed its major peers, helped by a weaker sterling, surging commodity prices and investors favouring defensive stocks.
However, the midcap index suffered losses of about 20% last year, hit by concerns of a recession, sky-high inflation and a series of interest rate hikes.
British Prime Minister Rishi Sunak will set out his priorities for 2023 on Wednesday, using his first speech of the year to try to reassure his restive Conservative Party that he has what it takes to lead them into the next national election.
Oil majors BP and Shell were down about 3% each as crude prices fell on concerns about weak demand due to the state of the global economy and China's rising COVID-19 cases.
Supermarket chains Tesco and Sainsbury's rose nearly 2% after data showed British grocery sales rose 9.4% to a record 12.8 billion pounds ($15.3 billion) in the four weeks to Dec. 25, driven by price inflation rather than increased purchasing.
Reporting by Shashwat Chauhan in Bengaluru; Editing by Sherry Jacob-Phillips and Shounak Dasgupta
Source: Reuters