Commodity, leisure stocks lead British shares higher on recovery optimism
Globally, the mood was also lifted by strong economic data from the United States and China and an easing in bond yields after a month of rapid gains. "There's lots of positive news about economic reopening and it's a risk-on kind of mood this morning," said Neil Wilson, chief market analyst for Markets.com.Reuters | London | Updated: 06-04-2021 14:07 IST | Created: 06-04-2021 14:05 IST
British shares were boosted on Tuesday by heavyweight commodity and banking stocks, while prospects of a planned economic reopening from a coronavirus lockdown starting next week lifted beaten-down travel and leisure stocks.
The blue-chip FTSE 100 index rose 1.2% to hit its highest since Jan. 11. Energy group BP Plc gained 2.8% and provided the biggest boost to the index after saying it expects to reach its $35 billion net debt target in the first quarter of 2021. Miners Rio Tinto, Glencore Plc, and Anglo American jumped more than 3% each, tracking higher metal prices. Banks, including HSBC Holdings Plc, Barclays Plc, and Lloyds Banking Group Plc, were among the biggest gainers.
Prime Minister Boris Johnson on Monday said with the vaccine rolling out rapidly across Britain and infection numbers falling, England could proceed to Stage 2 of his roadmap out of lockdown from April 12 with the opening of all shops, gyms, hairdressers, and outdoor hospitality areas. Globally, the mood was also lifted by strong economic data from the United States and China and an easing in bond yields after a month of rapid gains.
"There's lots of positive news about economic reopening and it's a risk-on kind of mood this morning," said Neil Wilson, chief market analyst for Markets.com. "As uncertainty about Brexit has pretty much cleared away and (hopes) of a stronger global economic recovery (increase), I'd expect the UK economy is going to be in a better position than some this year and sort of more domestic kind of UK focus stocks to do quite well."
The FTSE 100 has risen 5.5% so far this year, supported by speedy vaccine rollouts and a raft of economic stimulus. But a recent spike in virus cases across Europe and Treasury bond yields has made investors cautious. The domestically focused mid-cap FTSE 250 index added 1%, with cruise operator Carnival Plc and mall operator Hammerson Plc providing the biggest boost to the index.
J D Wetherspoon and Marston's Plc rose between 0.8% and 1.2% after vaccine minister Nadhim Zahawi said pubs and restaurants won't require vaccine certificates in the initial reopening of England's economy.
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