UK shares gain on optimism of stimulus-driven economic recovery
- UK shares gain on optimism of stimulus-driven economic recovery.
- FTSE 100 closes up 1.3% and the FTSE 250 ends 1.0% up on Monday.
- AB Foods, Quiz, BT Group were among the prominent price actions.
London-listed shares ended slightly up on Monday on optimism of stimulus-driven economic recovery. With the earnings season having kickstarted, investors will now be interested in the quarterly financial results of European and US companies in the upcoming weeks.
The UK’s blue-chip FTSE 100 index closed 1.3% up on Monday. In early trading, less than ten stocks listed on the commodity heavy index were reported in the red zone. The index opened at 6,095 on Monday and closed at 6,187.
FTSE 100 is still about 20% down year to date
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The domestically heavy FTSE 250 index, on the other hand, ended 1.0% up on Monday on the back of personal goods (.FTNMX3760), auto (.FTNMX3350), and mining (.FTNMX1770) stocks.
Despite a record increase in COVID-19 cases in a few of the US states, Asian stocks also started on a hawkish note on Monday. According to analyst Keith Temperton of Lombard Forte:
“July and August are generally weaker months for markets, but this time they are being pushed higher on liquidity infusion, upbeat corporate earnings updates and positive news on the COVID-19 vaccine.”
The FTSE 100 is still roughly 20% down year to date while the FTSE 250 is currently more than 20% down in 2020. Learn more about the different stock exchanges and stock indices.
Other prominent price actions on Monday
Other prominent price actions on Monday included Primark’s parent organisation, Associated British Foods (LON: ABF) that ended less than 1% up as the fashion retailer rejected British government’s bonus for calling furloughed employees back to work.
Quiz also closed more than 1% up as the British clothing company announced to have suspended business with a supplier that was recently accused in a media report of breaching the legal minimum wage requirements.
BT Group (LON: BT.A) CEO Philip Jansen urged PM Johnson on Monday to not rush into banning Huawei from the 5G network. The move, as per the CEO, can result in outages and may even fuel security issues. The stock dropped roughly 2% in the afternoon session but recovered almost completely before the market close.
Brexit negotiations are also starting to direct the UK financial markets again as the deadline of 31st December is approaching quickly. According to Cabinet Minister Michael Gove, the negotiations have progressed with the European Union, but there is still a lot of ground to cover.