FTSE 100 hits a two-week high ahead of central bank meetings

The blue-chip index FTSE 100 gained 0.4%, while the mid-cap FTSE 250 rose by 0.1%

The FTSE 100 rose to a two-week high on Tuesday, lifted by a gain in retailer and personal goods shares, while investors braced for central bank meetings through the week.

The blue-chip index FTSE 100 gained 0.4%, while the mid-cap FTSE 250 rose by 0.1%. Both indexes marked their fourth successive session of gains.

Kingfisher was the biggest gainer on FTSE 100, rising 11.2% after the home improvement retailer lifted its annual profit outlook, saying that seasonal sales trends have improved since early July.

The wider retailers index hit its highest levels since January 2022, up 2.8%.

The personal goods index added 2.8%, its biggest one-day jump in almost eight weeks, as sectoral heavyweights Burberry and Watches of Switzerland Group gained 3.1% each.

On the downside, aerospace and defence stocks led sectoral declines with a 2.2% decline.

Bae Systems plunged 4.7% to the bottom of FTSE 100.

A gauge of European aerospace and defence stocks slid 1.8%.

With eyes on the Fed's expected first interest rate cut on Wednesday, traders raised the possibility of a larger-than-usual 50 bp cut to 67%, according to the CME's FedWatch tool.

The BoE also meets this week. Analysts largely expect policymakers to leave rates on hold, so investors will primarily watch for clues on the BoE's path for the rest of the year and updates on the pace of its bond sales.

Shares of Essentra plummeted 15.2% after the plastic and metal components supplier warned that annual operating profit could miss market expectations due to weaker conditions in Europe and slower recovery in the Americas.

Shares of e-commerce firm THG slid 12.4% after the firm said it was actively looking to facilitate the demerger of its technology services arm.