LONDON: UK’s blue-chip index touched fresh two-year highs on Wednesday, joining a rally in global stock markets as investors cheered strong earnings while setting aside concerns about rising interest rates.

The FTSE 100 index closed up 1% to hit its highest level since January 2020 in a broad-based rally.

“It has been a day of solid gains for equity markets, which continue to put the volatility of January behind them,” said Chris Beauchamp, chief market analyst at online trading platform IG.

“Stocks of all types and sectors have made headway, a fact underlined by the inflows to equity markets in recent weeks, which has shown that investors are still content to buy the dip.”

Value-oriented sectors including miners, energy and banking that were battered during the pandemic have been picked up by investors recently, allowing the FTSE 100 index to outperform the wider European STOXX 600 index so far this year.

The midcap index jumped 1.8%, marking its best single-day performance in more than six months, boosted by travel stocks such as TUI, Wizz Air and easyJet that rose between 3.7% and 9.7%.

Barratt Developments Plc added 1% as it expects to build 250 more homes than its previous annual forecast, which would also cross pre-pandemic levels, easing concerns about demand in Britain’s housing market.

Paper packaging producer Smurfit Kappa gained 1.9% after posting record earnings in 2021 and saying it expected to increase prices further this year.

Vodafone rose 1.7% after a spokesperson from French telecoms group Iliad said on Tuesday it made an offer to buy 100% of Vodafone Italia. The Financial Times reported Iliad has offered more than 11 billion euros for the unit.

GSK dipped 1.4% despite forecasting growth in 2022 and beating quarterly forecasts in its first earnings report since rejecting Unilever’s bid for its consumer arm.