Biggest UK Stocks Nearest 52-Week Highs

British stocks in general are seeing modest gains this week amid optimism over the Middle East and following stronger-than-expected GDP results. Some stocks are ahead of the pack and could show signs of further gains if the outlook continues to improve.

10 Biggest UK Equities Near Highs for the Year

1. Rio Tinto (RIO) +24% YTD
2. BP (BP) +37% YTD
3. BAE Systems (BAES)  +31% YTD
4. Glencore (GLEN) +35% YTD
5. Ferguson (FERG) +15% YTD
6. Tesco (TSCO) +9% YTD
7. Vodafone (VOD) +16% YTD
8. BT Group (BT) +19% YTD
9. Halma (HLMA) +24.7% YTD
10. Rentokil (RTO) +11% YTD

Standouts Amid A Better-Performing Economy

The FTSE 100 rose on Thursday as earnings season kicked off amid extended peace talks in the Middle East, but has pared back some of those gains on Friday amid profit-taking ahead of the weekend. One of the things giving the index and UK stocks more broadly a boost was better-than-expected UK February GDP numbers. Although economists widely expect the growth trajectory to be marred by higher energy prices resulting from the war in Iran, the high benchmark helped bolster confidence in UK assets. Both services and industrial production expanded at 0.5% instead of the 0.1% anticipated, giving the economy more room to absorb potential impacts from the geopolitical situation.  Earnings reports also boosted optimism, as several companies reported better-than-expected results, led by Tesco, which continues to expand its market share despite low-cost competition.

A look at the biggest names in UK equities shows a fairly varied bunch, but an emphasis on energy, defence, and materials suggests the war is shaping which stocks are seeing the most gains. However, there is also a large presence of names that recently reported earnings, calling attention to how much earnings season could affect markets as investors search for value and growth amid geopolitical uncertainty.

Here's what's moving some of the top names in the UK this week: 

Tesco, Rentokil Supported by Earnings

The largest grocer in Britain reported full-year earnings on Thursday, beating analysts' estimates and posting growth in its free cash flow. However, traders focused on the company's guidance for the new fiscal year. Tesco said it was offering an unusually broad range in its sales outlook due to uncertainty about the effects of the war in Iran. The midpoint implies sales are expected to be unchanged from the current year. At the same time, Rentokil reported Q1 organic sales growth of 3.4%, above the 3.0% forecast, with strong growth in its US division reassuring investors that it can skirt higher input prices.

Energy Brings Rio Tinto-Glencore Hopes

It was a busy quarter for the two big miners on the list, as Glencore and Rio Tinto tried, but failed, to secure a merger. At the time, the focus was on energy transition metals, as the two companies sought to form a powerhouse in the copper production sector. However, the recent shake-up in the energy market resulting from the war in the Middle East, with the IEA suggesting that oil production might not be restored for a couple of years, has brought coal back into focus. Glencore CEO Nagle suggested this is an opening to restart merger negotiations with Rio Tinto, which has boosted investor sentiment for both companies.