FTSE 100 rallies, L&G and Greggs higher after updates
The FTSE 100 index is up 1.2% or 81.47 points at 6990.23, fuelled by hopes for a pivot on the Federal Reserve’s approach to interest rates.
The risers board included Legal & General, which gained 4% or 8.4p to 230.3p after the financial services group delivered a reassuring trading update. L&G said: “Volatility has increased significantly in H2, but this has limited economic impact on our businesses.”
Leisure stocks were also higher, with British Airways owner IAG and Premier Inn chain Whitbread up by 4%. Shares in Hargreaves Lansdown boasted the biggest gain in the FTSE 100, lifting 5% or 44.2p to 903.8p after Jefferies raised its price target to 930p.
The FTSE 250 index gained 1.3% or 233.89 points to 17,518.77, led by Greggs after the bakery chain stuck by profits guidance. Its shares were 5% or 89p higher at 1812p.
Wall Street recovers on rate rise hopes
Wall Street’s best session since late July means European markets are set for a positive start, with IG Index predicting that the FTSE 100 index will open 0.7% higher at 6958.
The US performance came after weaker-than-expected figures on manufacturing activity boosted hopes that the Federal Reserve will slow the pace of interest rate rises.
The S&P 500 jumped by 2.6% and the tech-heavy Nasdaq Composite by 2.3%, while US futures are also pointing to further progress later today. The next big test for sentiment is likely to come with Friday’s monthly non-farm payrolls report.
Mark Haefele, chief investment officer at UBS Global Wealth Management, said: “After falling more than 9% in September and extending its year-to-date decline to nearly 25% as of Friday’s close, we think the S&P 500 was looking oversold.
“In addition, some of last week’s selling pressure may have been driven by quarter-end rebalancing, which has now ended.”
Asian markets followed Wall Street’s lead as the Nikkei in Japan lifted by more than 2.5%.
Brent crude, meanwhile, remains just below $90 a barrel after rising 4% yesterday on expectations that Opec will reduce planned output at its meeting tomorrow.