Stocks were rallying early Tuesday, as the Ukraine army made gains against Russian invaders ahead of a new round of face-to-face peace talks.
Equities in London had started the week with trepidation, but US stocks rallied overnight and that optimism carried through to most of Asia on Tuesday.
The FTSE 100 index was up 59.63 points, or 0.8%, at 7,532.77 early Tuesday. The mid-cap FTSE 250 index rose 173.82 points, or 0.8%, to 21,243.85. The AIM All-Share index was up 5.22 points, 0.5%, at 1,042.81.
The Cboe UK 100 index was up 0.6% at 749.04. The Cboe 250 was up 1.0% at 18,786.69, and the Cboe Small Companies was marginally lower at 15,176.49.
In mainland Europe, the CAC 40 in Paris jumped 1.8%, while the DAX 40 in Frankfurt rallied 1.1%.
In Tokyo on Tuesday, the Nikkei 225 index closed up 1.1%. In China, the Shanghai Composite ended down 0.3%, while the Hang Seng index in Hong Kong was up 0.9% in late trade. The S&P/ASX 200 in Sydney ended up 0.7%.
In the US on Monday, Wall Street ended higher, with the Dow Jones Industrial Average ending up 0.3%, the S&P 500 up 0.7%, and the Nasdaq Composite up 1.3%.
Ukrainian and Russian negotiators resume peace talks on Tuesday, under the shadow of shock allegations that delegates were poisoned at a previous round of negotiations.
Russian oligarch Roman Abramovich and Ukrainian negotiators were said to have been targeted earlier this month, the Wall Street Journal reported, citing people familiar with the matter.
Ukrainian forces recaptured a key Kyiv suburb and desperately clung onto control of the besieged city of Mariupol.
Western experts described the loss of Irpin as a significant setback for Russian forces, who are still trying to regroup and after a failed first attempt to encircle the capital.
It is now more than a month since Russian President Vladimir Putin's tanks rolled into Ukraine, hoping to cripple or oust the democratic government in Kyiv.
Sterling was quoted at $1.3113 early Tuesday in London, up against $1.3090 at the London equities close on Monday.
The euro traded at $1.1014 early Tuesday, up from $1.0973. Against the yen, the dollar rose to JP¥123.68 versus JP¥123.32.
North Sea benchmark Brent crude oil rose to $112.29 a barrel early Tuesday versus $111.48 late Monday. Covid-19 worries in China have depressed oil prices in recent sessions.
Shanghai recorded a steep climb in Covid-19 cases on Tuesday as spreading anxiety in the Chinese city of about 25 million prompted panic-buying at supermarkets. Millions endured a second day of lockdown after authorities effectively split the country's biggest urban area in two, with residents of the city's eastern half confined to their homes for four days and subjected to mandatory testing.
China reported 6,886 domestic Covid cases nationwide on Tuesday, with more than 4,400 of them detected in Shanghai, now the centre of the country's worst Covid-19 outbreak since the early days of the pandemic.
Swissquote analyst Ipek Ozkardeskaya commented: ‘[The] Shanghai lockdown combined with the rising Covid cases in China boosted worries that the fresh health crisis could extend and further weigh on Chinese oil demand - but the temporary fall in Chinese demand should do little to the demand-supply dynamics in the medium-term, which remains in favour of bullish market conditions.
‘Many oil traders predict that the price of a barrel could reach $200 by the end of the year. Goldman Sachs warns that the barrel of crude at $200 would send the economy into recession as it would 'produce an income shock similar in magnitude to those that precipitated the 1974 and 1979 recessions'.’
In London, grocer Ocado and lender Barclays bookended the FTSE 100 in early dealings.
Ocado shares rose 3.2%, despite numbers from Kantar showing its grocery sales and market share fell in the 12 weeks to March 2022.
Ocado's sales fell 6.7% annually and the online grocer's market share slipped to 1.8% from 1.9%. However, its sales were 25% higher on a two-year basis.
Kantar analyst Fraser McKevitt commented: ‘Two years on since the first lockdown, we can assess what permanent changes the pandemic has made to the grocery landscape. The real story of Covid-19 has been the acceleration of online shopping, and retailers have built their digital capacity to match a seismic change in demand.’
McKevitt noted 13% of sales during the 12-weeks were made online, compared to 8% three years earlier.
Total UK grocery sales fell 6.3% yearly to £29.17 billion during the period. They rose 0.7% on a two-year basis.
Barclays continued to fall after tumbling 8.7% on Monday. The stock was 4.8% lower in early trade. JP Morgan downgraded the bank to 'neutral' from 'overweight'.
Barclays on Monday had admitted to selling more products to investors than it was allowed to. It forecast a £450 million hit as a result.
Elsewhere in London, property firm McKay Securities rose 2.8% and office space provider Workspace added 1.6%.
Workspace may face a competing offer for McKay.
Slate Asset Management has asked for access to due diligence information in order to consider making an all-cash offer for McKay. Both Workspace and McKay noted that no takeover proposal has been made by Slate, though McKay said it would consider one.
For now, the McKay board continues to recommend the £272 million cash-and-shares offer from Workspace and a shareholder vote on this is scheduled for April 27.
Slate has until April 20 to announce whether or not it plans to make a firm offer for McKay.
AG Barr shares rose 3.7%. The Irn-Bru maker posted a substantial earnings rise for a year in which it resumed payouts.
Revenue in the year to January 30 rose 18% to £268.6 million from £227.0 million. Pretax profit was 62% higher at £42.2 million from £26.0 million.
AG Barr proposed a 10p final payout, taking its ordinary dividend for the year to 12p. It had also paid a 10p one-off special dividend in October. The soft drinks maker had paid out nothing in financial 2021 and 4.00p in financial 2020.
Liberum maintained its 'buy' rating on AG Barr following the results. The investment bank called the stock ‘a top quality defensive play delivering underlying double-digit growth’. It has a 655.0 pence price target on AG Barr, 19% above the current price of 551.53p.
Gold was quoted at $1,920.18 an ounce, lower than $1,937.20 on Monday.
Still to come on the economic events calendar on Tuesday are UK mortgage approvals at 0930 BST and US consumer confidence at 1400 BST.
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