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FTSE 100 up 0.23%, FTSE 250 rises 0.82%

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Kingfisher surges on raising full-year profit forecast

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Serco ( SECCF ) rises on $972 million US Air Force contract

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Sterling dips after gloomy PMI surveys

Sept 23 (Reuters) - London stocks edged higher on

Tuesday, led by retailers, while a weaker sterling further

boosted the exporter-heavy FTSE 100 index.

The benchmark FTSE 100 rose 0.23% at 0959 GMT while

the domestically focused FTSE 250 gained 0.82%.

An index of retailers' stocks rose about 3%,

boosted by a 15.2% surge in Kingfisher after the home

improvement retailer raised its full-year profit outlook after a

better-than-expected first half. Its shares were on track for

their highest single-session percentage gain since 1986.

Other major retailers also advanced, with JD Sports Fashion

rising 1.6%, Frasers ( SDIPF ) up 2.3%, and Howden Joinery ( HWDJF )

gaining 3.5%.

The pound weakened, giving a further lift to export-oriented

firms, after a survey showed British business activity slowed in

early September.

Meanwhile, a separate survey showed on Tuesday that British

firms have reported a loss of momentum and confidence ahead of

possible new tax increases in Finance Minister Rachel Reeves'

next budget in November. It also showed another drop in hiring.

Last week, the Bank of England held its benchmark rate at 4%

and said it is monitoring for signs that inflation pressures are

waning before it reduces borrowing costs again.

Among other stocks, Serco Group ( SECCF ) was among the top

gainers in the FTSE 250, up 4.4%, after a unit of the British

outsourcing firm secured a contract to provide training and

simulator services to the U.S. Air Force.

Engineering firm Smiths Group ( SMGKF ) reported profit and

revenue above market estimates, helped by strong demand for

upgraded baggage-screening detectors and a recovery in the

semiconductor market. Its shares hit an all-time high in early

trading but later fell 0.8%.

The broader healthcare sector declined 1.3%

with Oxford BioMedica's ( OXBDF ) 9.2% loss after the British cell

and gene therapy manufacturer reported its half-year results.

Eyes were also on GSK as U.S. President Donald

Trump's administration asked drug companies to be prepared to

ramp up production of leucovorin, a form of folic acid, as a

treatment for some autism patients. GSK previously manufactured

leucovorin and sold it under the name Wellcovorin.

Shares of the drugmaker fell 0.7% in early trading.