FTSE 100 trades higher as investors grow bullish over US-China relations
London’s blue-chip index closed up 0.74%.
London’s blue-chip index and oil prices traded higher on Tuesday as investors were bullish over a possible breakthrough in trade talks between the US and China.
London’s top index closed 50.72 points, or 0.74%, higher at 6,861.6 – while Germany’s DAX rose 0.76% and France CAC grew 1.41%.
David Madden, market analyst at CMC Markets, said: “Dealers have high hopes for the US-China trade talks, and there were some optimistic words from President Trump, and that added to the bullish move.
“The negotiations will extend into this evening, and given the lack of negative macroeconomic news, traders are content to add to the bounce back that began in late December.”
HSBC shares rallied on positive sentiment surrounding China, as the banking giant conducts most of its business in the Far East.
The bank’s “stock is contributing the most to the FTSE 100 in terms of index points on account of its large weighting in the index”, Mr Madden said as HSBC’s London-listed shares closed up 7p to 649.1p.
Brent crude, the international benchmark, rose 1.1% at 58.31 US dollars (£45.79).
The pound weakened on a firmer US dollar. Sterling was down 0.36% against the greenback at 1.272 and was flat versus the euro at 1.112 at the London market close.
Meanwhile, it was a busy day for retailers with a string of announcements from Morrisons, Greene King, Joules and Footasylum.
Morrisons unveiled an increase in Christmas sales thanks to stronger growth in its wholesale arm, despite a slowdown in retail shopping.
Like-for-like sales in the nine weeks to January 6 were 3.6% higher for the supermarket chain.
While pub group Greene King cheered strong festive trading after customers brushed aside Brexit fears to send sales surging over Christmas and new year.
The Hungry Horse and Chef & Brewer owner said like-for-like sales in its managed pubs jumped 10.9% in the two weeks to January 6.
Upmarket clothing firm Joules thanked a strong online performance for helping send festive sales surging by nearly 12%.
The group – famous for its bright wellies and outdoor clothing – saw comparable retail sales rise 11.7% over the seven weeks to January 6.
However, Footasylum warned over pressure on full-year earnings after it slashed prices amid heavy discounting on the high street.
Shares in the chain plunged more than 15% after it said it now expects full-year underlying earnings to be towards the lower end of forecasts, as profit margins were hit by steep discounting over the festive season.
Morrisons shares closed down 7.05p to 212.6p, Greene King up 30.8p to 584p, Joules up 10.5p to 255p, and Footasylum down 3.5p to 29p.
Elsewhere, building supplies firm SIG blamed economic uncertainty for contributing to tough conditions in the construction industry as the group posted a disappointing set of figures.
Like-for-like sales at the company dropped 4.7% in the six months to December 31, with comparable revenue 2.3% lower over the full year.
The biggest risers on the FTSE 100 were Smurfitt Kappa up 128p to 2,208p, DS Smith up 18p to 324p, Marks & Spencer up 14.5p to 275.2p, and Melrose Industries up 9.05p to 175.35p.
The biggest fallers on the FTSE 100 were Hikma Pharmaceuticals down 88p to 1,599.5p, Morrisons down 7.05p to 212.6p, BT Group down 6.95p to 231p, and Fresnillo down 19.4p to 896.6p.