London close: Bullish buying fuels positive session
London stocks closed higher on Monday, boosted by encouraging Chinese data and strong performances from the likes of HSBC and Diageo, while the pound was lifted by Brexit hopes.
The FTSE 100 ended the session up 1.46% at 5,927.93, and the FTSE 250 was 1.91% stronger at 17,370.27.
Sterling was well into the green in late trading as well, last gaining 0.86% on the dollar to $1.2856, and advancing 0.69% against the euro to €1.1031.
“There has been a huge shift in sentiment when compared with the losses that were posted in the eurozone on Friday,” said CMC Markets analyst David Madden.
“Equities in the US are driving higher, but stocks on this side of the Atlantic have been gaining ground since the morning.
“The health crisis in Europe is still serious but dealers have shrugged it off.”
Madden described London’s session as a “broad-based rally”, with banks, oil, housebuilding, supermarkets, hospitality, transport and travel plays all showing gains.
“Traders are clearly content to buy back into the market in light of the losses that were posted last week, but the bullish move seems excessive when you consider the uncertainty in relation to the UK-EU trades talks, the lack of a stimulus package in the US, and the health woes.”
Figures released earlier showed that industrial profits in China rose 19.1% on the year in August.
Although that was down from 19.6% growth in July, it marked the fourth month in a row of profit growth as factories continued to recover from the Covid-19 shutdown.
Despite the positive tone, worries about the coronavirus crisis and further restrictions remained on investors’ minds, particularly after weekend reports the government is considering banning all socialising indoors and closing all pubs and restaurants in Northern England and London amid a rise in cases.
In corporate news, HSBC surged 8.89% after its biggest shareholder, China’s Ping An Asset Management, lifted its stake in the bank.
Other banks followed suit, with Standard Chartered up 7.48%, Barclays adding 7.06%, and Lloyds 7.58% higher.
Diageo gained 6.09% after saying it made a good start to the current financial year as the drinks company's US business beat expectations.
The maker of Johnny Walker whisky and Guinness beer said its outlook had improved since the end of June.
Sales improved compared to the second half of last year, but sales and margins would be lower than in the first half of last year.
Great Portland Estates was a high riser, adding 10.5% after private equity firm KKR bought a 5.35% stake in property company for around £74m.
Its peers also gained, with Land Securities ahead 7.85%, British Land rising 7.36%, and Shaftesbury 7.82% firmer.
On the downside, William Hill was 11.63% weaker after it and Caesars Entertainment confirmed they were in advanced talks on a £2.9bn cash offer for the UK bookmaker.
The shares had already risen sharply on Friday on news of a deal.
FTSE 100 - Risers
HSBC Holdings (HSBA) 308.55p 8.89%
Land Securities Group (LAND) 533.00p 7.85%
NATWEST GROUP PLC ORD 100P (NWG) 107.30p 7.71%
Lloyds Banking Group (LLOY) 26.59p 7.58%
Standard Chartered (STAN) 362.00p 7.48%
British Land Company (BLND) 346.10p 7.36%
Barclays (BARC) 98.00p 7.05%
Melrose Industries (MRO) 117.95p 6.69%
Legal & General Group (LGEN) 188.95p 6.15%
Diageo (DGE) 2,675.00p 6.09%
FTSE 100 - Fallers
Rolls-Royce Holdings (RR.) 149.25p -3.55%
GVC Holdings (GVC) 975.40p -2.30%
Flutter Entertainment (FLTR) 12,425.00p -2.01%
Glencore (GLEN) 164.58p -1.67%
Polymetal International (POLY) 1,651.00p -1.58%
Admiral Group (ADM) 2,653.00p -1.30%
Rio Tinto (RIO) 4,678.50p -1.15%
Ferguson (FERG) 7,416.00p -1.12%
Kingfisher (KGF) 292.90p -1.01%
Fresnillo (FRES) 1,173.50p -1.01%
FTSE 250 - Risers
Rank Group (RNK) 102.00p 11.60%
Great Portland Estates (GPOR) 610.40p 10.50%
National Express Group (NEX) 152.20p 10.05%
Workspace Group (WKP) 525.00p 8.83%
Crest Nicholson Holdings (CRST) 195.10p 8.75%
Investec (INVP) 138.00p 8.24%
Paragon Banking Group (PAG) 327.80p 8.04%
Shaftesbury (SHB) 514.50p 7.82%
Trainline (TRN) 382.20p 7.66%
Close Brothers Group (CBG) 1,018.00p 7.55%
FTSE 250 - Fallers
William Hill (WMH) 275.90p -11.63%
Network International Holdings (NETW) 274.60p -6.28%
Indivior (INDV) 115.50p -5.33%
Fisher (James) & Sons (FSJ) 1,118.00p -3.30%
Energean (ENOG) 586.30p -2.14%
Kainos Group (KNOS) 1,002.00p -1.96%
Oxford Instruments (OXIG) 1,612.00p -1.35%
Hochschild Mining (HOC) 210.80p -1.31%
888 Holdings (888) 205.00p -1.20%
Vectura Group (VEC) 112.00p -1.07%