* Next hits record high after lifting profit outlook
* FTSE edges higher in mid-session trading
* FTSE to hit 7,000 in Q2 - SVM's McLean
By Sudip Kar-Gupta
LONDON, Jan 3 A surge in clothing retailer Next
nudged Britain's top equity index up on Friday, with
many traders expecting the market to push on to record highs
later this year.
The blue-chip FTSE 100 index was up by 0.1 percent,
or 7.12 points, at 6,724.31 points in mid-session trade.
Next shares hit record highs after the company raised its
annual profit outlook following strong Christmas sales. The
shares rose as much as 11 percent and added the most points to
the FTSE 100.
"In all, Next investors are again being rewarded. Current
full-year profits are now expected to exceed prior management
forecasts, although reassuringly, management appears to remain
level headed," said Keith Bowman, equity analyst at Hargreaves
Rival retailer Marks & Spencer - which sells both
clothes and food - advanced by 4 percent as traders hoped for a
similarly strong result from M&S after Next's performance.
SVM Asset Management managing director Colin McLean said
that while he was not that positive on UK food retailers due to
worries that they have been losing market share to German rivals
Aldi and Lidl, he was more upbeat on
clothing retailers such as Next.
McLean felt companies in that sector would benefit from a
gradual recovery in the British economy and in consumers'
He said he expected the FTSE 100 to hit a record level of
7,000 points in the second quarter of 2014. The index rose 14.4
percent in 2013 to mark its best annual gain since 2009.
"Any pullback on the market will be brief and shallow.
There's still quite a weight of money coming into the stock
market," McLean said.