| London stocks were lifted on Tuesday as wage growth overtook inflation for the first time in a year but fell short of market expectations, lifting the mood in the consumer-focused sectors and simultaneously putting pressure on the pound. The FTSE 100 edged steadily higher over the session, finishing up 27.85 or 0.39% to 7,226.05, as the wage data sent the pound down 0.3% against the dollar to 1.4292, but flat against the euro at 1.157. This was a retreat a day after sterling had hit its strongest level since the Brexit vote at 1.4377. A weaker pound tends to boost the top-flight index as around 70% of its constituents derive most of their earnings from overseas. Wage growth numbers released earlier rose above inflation for the first time in 13 months, which all but sealed the deal on a Bank of England interest rate hike in May. However, UK average weekly earnings rose 2.8% in the three months to February compared to the same period last year, which was unmoved from growth figures a month earlier but short of the 3.0% expected by economists, resulting in the hit to the pound. Excluding bonuses, average weekly earnings growth improved to 2.8% from 2.6% a month ago, as the Bank of England forecast for the first half of 2018 and economists had expected. Both measures overtook consumer price inflation, which came in at 2.7% for February, as unemployment was also confirmed as having fallen back to 4.2%, its joint-lowest level since 1975. With 32.26m people in work during the three months to February, the employment rate rose to 75.4%, which is the highest since comparable records began in 1971. HSBC economists said the data strengthens the case for a hike in May but they do not expect any further rate rises after that, indicating why the pound had been knocked off its perch. Peter Dixon, senior economist at Commerzbank, agreed that the fall in the jobless rate strengthens the case of those who believe the economy is running with too little spare capacity "and the fact that wage growth is now also marginally ahead of the inflation rate will also be used as an argument for a May rate hike". But he said with first-quarter UK GDP figures next week looking likely to turn out quite weak, "we would need to see signs of a rebound in subsequent quarters in order that the BoE can deliver a second rate hike before year-end". On the corporate front, retailers were prominent at the top of the leaderboard as the improving wage outlook provides a potential boost for the squeezed UK consumer. Next, Marks & Spencer and Tesco, still basking in the glow of its results last week, were among the top risers and Primark owner Associated British Foods also rallied after it left its annual outlook unchanged as falling profit at the company's sugar business offset the strength at its clothing chain to result in a 1% decline in first-half profit. "Investors appear to be giving the group a free pass on the numbers this morning, reasoning that better weather and an improvement in consumer spending could help cushion performance in coming months, even if some will continue to wonder why the firm bothers to hold on to its underperforming sugar business," said IG analyst Chris Beauchamp. Another retail impressing investors was JD Sports, which jogged higher after posting a 24% jump in full-year profit as sales grew and the company's international expansion paid off. The group saw like-for-like stores sales growth of 3%, while LFL website sales growth was in excess of 30%, feeding through to profit before tax and exceptionals sprinting up 26% to a record £307.4m and allowing the company to power-lift its dividend to 1.63p a share. Russian steelmaker Evraz was the standout gainer on the FTSE 100 amid relief that US President Trump's surprise move to decide to hold off on imposing additional sanctions on Russia for support of the Assad regime in Syria. White House press secretary Sarah Huckabee Sanders said: "the president has been clear that he's going to be tough on Russia, but at the same time he'd still like to have a good relationship with them." Oil prices were also holding steady, with Brent at $71.53 a barrel and BP, Shell and others in positive territory. GKN gained as Melrose Industries said its takeover offer for the engineer will be declared wholly unconditional later this week after receiving acceptances over more than 81% of the engineer's shares. Specialist emerging markets asset manager Ashmore Group racked up strong gains after posting a 10% rise in third-quarter assets under management as net inflows were at their best level since June 2013. This also provided a fillip for Standard Life Aberdeen, which has a strong emerging markets focus. Roadside assistance and breakdown cover provider AA was sharply higher as its full-year adjusted earnings per share beat forecasts. Tate & Lyle edged higher after announcing the appointment of Mondelez's Imran Nawaz as its new chief financial officer, with effect from 1 August, while InterContinental Hotels ticked up as it restated its results for the last two years that showed revenue for 2017 more than doubled. On the downside, Intu Properties fell despite hailing a "strong" first quarter with a record level of retailer demand, as it made no mention of its deal with Hammerson, which hangs in the balance after it emerged last week that the housebuilder's largest shareholder is planning on voting against it. Reckitt Benckiser was hit by a downgrade to 'underperform' at Credit Suisse. | 
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