London stocks jump as China data fuels recovery optimism

UK shares jumped to fresh three-month highs on Wednesday as data showed China's services sector returned to growth in May, bolstering hopes of a faster global rebound from a coronavirus-driven slump.

The export-heavy FTSE 100 rose 1.1%, as the reading of a survey gauging China's May services sector activity jumped to its highest level since 2010 following the easing of sweeping lockdowns. The mid-cap FTSE 250 added 1.6%, with energy, life insurers, and aerospace-related stocks among the early gainers.

UK stock markets have rebounded sharply from a coronavirus-driven crash in March, with optimism about easing stay-at-home orders and more global stimulus offsetting concerns about U.S.-China tensions and growing civil unrest in the United States. The FTSE 100 is now less than 20% below its January record high, with battered autos, real estate, and travel stocks driving the rebound since April.

"Every single dip across financial markets is being bought into relentlessly," said Stephen Innes, markets strategist at AxiCorp. "Easy money, cash on the sidelines, and signs of lockdowns easing are all helping to keep risk markets well bid." Travel and leisure stocks rose for a third straight session as the government said it would review its quarantine procedures for international arrivals based on their economic impact.

An 8.4% jump for TUI Group, Europe's biggest travel company, was also driven by a deal it struck with U.S.-based Boeing for compensation and slower delivery of the 737 MAX aircraft. Defense contractor Chemring Group soared 23.4% and was on course for its best day in almost eight years as it maintained its annual targets and raised dividends after winning new orders from the United States despite the coronavirus crisis.

Travel food group SSP slipped 2.2% after launching a shares-for-dividend deal as it swung to a first-half loss due to coronavirus-led store closures.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)