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(Alliance News) - The FTSE 100 registered a solid session on Monday, adding nearly 70 points on US-China trade deal hopes and overcoming headwinds from a stronger pound.
"Shaken last Friday by an appalling pair of PMIs, sterling got its mojo back on Monday after a monthly poll of polls put the Tories on course for an 80 seat majority," commented Connor Campbell at Spreadex.
"Normally such a surge from sterling would give the FTSE an immediate migraine," he continued. "However, the strength of positive sentiment following the Global Times' claim that the US and China are 'very close' to a deal – alongside the pro-democracy results in Hong Kong and Beijing's announcement of Washington-appeasing IP protections – meant the UK index spent Monday with a smile on its face."
The FTSE 100 index closed up 69.48 points, or 1.0%, at 7,396.29. The FTSE 250 ended up 217.36 points, or 1.1%, at 20,703.17, and the AIM All-Share closed up 2.52 points, or 0.3%, at 909.42.
The Cboe UK 100 ended up 1.0% at 12,537.33, the Cboe UK 250 closed up 1.1% at 18,571.68, and the Cboe Small Companies ended flat at 11,303.88.
The pound was quoted at USD1.2906 at the London equities close Monday, higher compared to USD1.2831 at the close on Friday.
As the general election campaign enters its final two-and-a-half weeks, party leaders are set to see their promises put under the microscope, with forensic interviews by the BBC's Andrew Neil scheduled.
SNP leader Nicola Sturgeon will be the first to be quizzed on Monday evening, before the spotlight is put on Labour's Jeremy Corbyn on Tuesday.
UK Prime Minister Boris Johnson will resume campaigning in Wales, while Corbyn will be in South Yorkshire discussing Labour's GBP58 billion compensation promise to Waspi women who lost out financially when the retirement age was pushed back from 60 to 66.
In European equities on Monday, the CAC 40 in Paris ended up 0.5%, while the DAX 30 in Frankfurt rose 0.6%.
Stocks in New York were higher at the London equities close, with the Dow Jones up 0.4%, the S&P 500 index up 0.6%, and the Nasdaq Composite advancing 1.1%.
Uber shares trimmed early losses, the stock quoted 1.8% lower in morning trade, after the ride-hailing app was refused a license by London's transport body.
Meanwhile, Tiffany shares gained 6.1% to USD133.19 after reaching a deal to be taken over by LVMH Moet Hennessey Louis Vuitton.
The USD135 per share deal has an equity value of around USD16.2 billion, exceeding the initial USD120 per share bid tabled on October 28 which valued the US ring maker at USD14.5 billion. LVMH, which owns watch brand Tag Heuer and jewellery brand Bvlgari, expects the deal to "transform" its Watches & Jewellery division, strengthen its overall jewellery position, and increase its US presence.
In Paris, LVMH shares closed up 2.0%. In London, shares in luxury fashion house Burberry closed up 2.9% on the M&A sector news.
In a day of some bumper deals, stockbroker Charles Schwab was successful in its takeover attempt of rival online broker TD Ameritrade Holding following agreement for a share swap with Toronto-Dominion Bank.
The deal values TD Ameritrade around USD26 billion, with the stock up 6.9% in New York.
Charles Schwab said the deal will add 12 million client accounts, USD1.3 trillion in client assets and about USD5 billion in annual revenue to its current total. The combined firm will have 24 million clients, with more than USD5 trillion in assets combining for an annual revenue of USD17 billion and pretax profit of USD8 billion.
Shares in San Francisco-based Charles Schwab were up 1.9%.
And, lastly, online marketplace eBay has sold StubHub for USD4.05 million to rival viagogo.
StubHub is a ticket marketplace based in the US. viagogo's founder & chief executive, Eric Baker, also co-founded StubHub, but left before eBay bought it for USD310 million in 2007. Baker said it had "long been" his wish to "unite" the two companies.
On Wall Street, eBay shares were trading 1.2% higher.
Among currencies, the Japanese yen was trading at JPY108.91 against the dollar, flat compared to JPY108.63 late Friday.
The euro stood at USD1.1008 at the European equities close Monday, soft against USD1.1032 at the same time on Friday.
In European data, German business sentiment improved marginally in November, the Munich-based ifo Institute said, despite ongoing manufacturing woes.
The Business Climate Index rose to 95.0 points in November from 94.7 in October, marking the highest reading since July. The expectations index also rose slightly, to 92.1 from 91.6.
Among sectors, the Business Climate Index slipped further for manufacturing to minus 5.9 in November from minus 5.3 in October.
All in all, the ifo Institute expects gross domestic product growth for Germany of 0.2% in the fourth quarter from the third. This would follow growth of 0.1% in the third quarter from the second.
In commodities, Brent oil was quoted at USD63.26 a barrel at the London equities close Monday, flat compared to USD63.50 late Friday.
Gold was quoted at USD1,457.22 an ounce at the London equities close Monday, down from USD1,464.30 at the close on Friday.
"Gold is a little lower today on the back of the risk-on attitude of traders. The asset has a history of falling whenever dealers are keen to take on more risk – buy stocks. After hitting a six-year high in September, the metal has been drifting lower, and that is playing out today. Should the recent bearish move continue, it might target the 1,445 region," said David Madden at CMC Markets.
Following the safe haven metal lower was gold miner Fresnillo, closing down 3.8% and ending Monday's session at the bottom of the FTSE 100. Mid-cap precious metals miners also fell, with Hochschild down 5.7% and Centamin down 2.4%.
Elsewhere in the FTSE 250, Restaurant Group shares shed 8.8% despite the casual dining chain reporting strong sales at Wagamama.
Revenue in the 13 weeks to September, Wagamama's second quarter, rose by 11% year-on-year to GBP93.5 million, with like-for-like revenue growth coming in at 6.3%. Restaurant Group's own financial year aligns with the calendar year.
Wagamama generated GBP16.7 million of adjusted earnings before interest, tax, depreciation, and amortisation in the quarter, Restaurant Group said, 27% higher than a year before. Overall, the brand delivered a 5.1% outperformance of the UK market, the company said, and has consistently outperformed over the past five years.
IT infrastructure firm Softcat ended down 2.7% after Berenberg cut the stock to Hold from Buy.
In the UK corporate calendar on Tuesday, there are annual results from contract caterer Compass, a trading statement from building materials firm CRH, third quarter results from inspection and product testing firm Intertek, and half year results from convenience foods business Greencore and sausage maker Cranswick.
In the economic calendar on Tuesday, there is German Gfk consumer confidence at 0700 GMT and UK mortgage approvals at 0930 GMT. In the US is the housing price index at 1355 GMT and consumer confidence at 1500 GMT.
By Lucy Heming; lucyheming@alliancenews.com
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