Earnings, rate cut bets lift UK stocks

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Jan 21 (Reuters) - The UK's main stock indexes edged higher on Tuesday, with a slide in sterling keeping the FTSE 100 near all-time highs, while upbeat earnings from companies including Abrdn and Premier Foods boosted the midcap index.

The blue-chip FTSE 100 .FTSE were up 0.1% by 1043 GMT, trading just below its intraday record high of 8542.59 points touched on Monday.

Global stocks were sluggish a day after U.S. President Donald Trump's inauguration, as investors digested the president's plans for trade relations and tariffs.

Sterling GBP=D3 dropped 0.67% against the dollar after data showed UK jobless rate rose slightly to 4.4% in the three months to November, its highest since the three months to May.

Numbers also showed that British pay growth remained stubbornly strong in the three months to November.

Traders are pricing in an 84% chance of a 25 basis point rate cut from the BoE on Feb. 6, and about 62 bps of easing overall by the end of 2025.

Leading gains in the FTSE 100, Lloyds Banking Group LLOY.L rose 4.1% after the Financial Times reported that finance minister Rachel Reeves launched a bid to protect car-loan providers from multibillion-pound payouts in the mis-selling case.

"The UK government's backing in the motor finance case is a clear positive for Lloyds, the bank most exposed to the issue," said Matt Britzman, senior equity analyst, Hargreaves Lansdown.

Barclays BARC.L rose 0.9%, while the wider FTSE 350 banks index .FTNMX301010 climbed 0.7%.

Boosting the FTSE 250 midcap index by 0.4%, Abrdn ABDN.L jumped 5% after the asset manager reported 1.2 billion pounds ($1.5 billion) of net inflows of client cash in the fourth quarter of 2024.

Premier Foods PFD.L climbed 4.1% after the food producer forecast its annual profit at the upper end of analysts' expectations, following robust sales of its branded products during the key holiday season.

Serica Energy SQZ.L rose 1.5% after the UK North Sea-focused oil and gas company forecast a 15.6% increase in 2025 production, helped by improved reliability of its assets.

(Reporting by Sruthi Shankar in Bengaluru; Editing by Vijay Kishore)

((sruthi.shankar@thomsonreuters.com; within U.S. +1 646 223 8780; outside U.S. +91 80 6182 2787;))

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