The FTSE 100 declined marginally in the morning, shedding less than 0.1%.
The Office for National Statistics said today that consumer price inflation in the UK rose from 3.7% in December to 4% January, which is the highest rate since November 2008 and double the Bank of England’s target of 2%.
The retail price index climbed from 4.8% to 5.1%.
The data has turned up the pressure on the Bank of England to hike its ultra-low interest rates.
Barclays (LON:BARC) led the blue chips, surging 4% after its 2010 results beat expectations, showing that pre-tax profits rose 32% to £6.07 billion in 2010, while net income jumped 22% to £25.77 billion.Part-nationalised banks Lloyds (LON:LLOY) and Royal Bank of Scotland (LON:RBS) followed, climbing 2.6% and 1% respectively.
Monday’s top performers, engineering company Weir Group (LON:WEIR) and chipmaker ARM Holdings (LON:ARM), slipped 3%.
InterContinental Hotels (LON:IHG) was the heaviest faller in the FTSE 100, shedding 4% after its 2010 results failed to meet expectations. The world’s largest hotels group said its revenues rose 6% to US$1.63 billion, while total adjusted earnings per share declined 4% to 98.6 US cents.
Elsewhere in Europe, France’s CAC 40 added 0.4%, Spain’s IBEX 35 climbed 0.6% and Germany’s DAX tacked on 0.1%.
Financial bookmakers are expecting a slat start on Wall Street today.
Futures for the Dow Jones Industrial Average (DJIA) were unmoved in the morning, while S&P 500 and NASDAQ futures rose marginally.
Marriott Intl (NYSE:MAR) shares surged 5% in pre-market, while United States Steel (NYSE:X) and Sprint Nextel (NYSE:S) rose 2.2% and 1.8% respectively.
Newmont Mining (NYSE:NEM) climbed 1.25%.
Today’s US data will include the Empire State manufacturing survey, business inventories, retail sales, import and export price indices and the ABC News consumer confidence survey.
Asian stocks moved in different directions.
China’s Shanghai Composite Index rose marginally and Japan’s Nikkei 225 tacked on 0.2%, while Hong Kong’s Hang Seng declined 1% and South Korea’s KOSPI declined 0.2%.
Australia’s S&P/ASX 200 shed 0.1%.