Stocks in London started the week on the front foot, picking up strength as Monday’s trading session wore on, to post healthy gains by the close.
Gold hit a new high before fading, airlines and miners were in demand, while Entain prospered on bid speculation.
The FTSE 100 index closed up 32.31 points, 0.4%, at 7,943.47. The FTSE 250 ended up 128.64 points, 0.7%, at 19,854.58, and the AIM All-Share closed up 8.78 points, or 1.2%, at 748.83.
The Cboe UK 100 ended up 0.5% at 794.13, the Cboe UK 250 closed up 0.8% at 17,288.54, and the Cboe Small Companies ended up 0.1% at 14,693.06.
The brighter mood was reflected in Europe. The CAC 40 in Paris closed up 0.7% while the DAX 40 in Frankfurt climbed 0.8%.
Across the pond, stocks in New York were mixed at the London equities close, with the DJIA slightly lower, the S&P 500 slightly higher, and the Nasdaq Composite up 0.1%.
On Wednesday, US inflation figures will be released.
The report is expected to show that the rate of US annual consumer price inflation picked up to 3.4% last month, from 3.2% in February, according to FXStreet cited consensus.
Last Friday, strong jobs data tilted appeared to tilt the balance against a rate cut at June’s FOMC meeting.
According to the Bureau of Labor Statistics, nonfarm payroll employment rose by 303,000 in March, higher than the FXStreet-cited consensus of 200,000.
The figure for February was revised down by 5,000, from 275,000 to 270,000 while January’s total was adjusted upwards by 27,000, from 229,000 to 256,000. This means employment in January and February combined was 22,000 higher than previously reported.
Nonetheless, the CME FedWatch tool places a 51% chance that interest rates will be lowered by 25 basis points in June, albeit lower when compared to 57% this time a week ago.
The pound was quoted at $1.2652 at the London equities close on Monday in London, up from $1.2621 late Friday. The euro rose to $1.0854 from $1.0831. Against the yen, the dollar rose to JP¥151.82 from JP¥151.54.
Gold hit a new record high on Monday, above $2,350 per ounce before easing back.
Gold was quoted at $2,330.93 an ounce on Monday at the London equities close, up from $2,325.89 late Friday.
UBS thinks the gold price has further to run in 2024 despite its strong start to the year.
UBS explained it had previously expected gold to rise to $2,250 per ounce by the end of the year.
‘But it has rallied faster and more forcefully than our already bullish expectations,’ the broker noted.
The Swiss bank increased its forecasts by $250 per ounce, expecting gold to trade at $2,300 per ounce in June and at $2,500 per ounce at end-2024 and end-March 2025.
The move in the price supported gold miners Fresnillo in the FTSE 100, which rose 2.6%, and Hochschild Mining, which led the FTSE 250 risers, up 5.4%.
Other mining stocks prospered with Rio Tinto up 4.2%, Anglo American up 3.2% and Glencore up 1.9%.
Elsewhere, in London’s FTSE 100, Entain climbed 4.7% after The Sunday Times reported it was considering its options for a number of assets, reigniting bid speculation.
The bookmaker, which owns Ladbrokes and Coral, has called on investment bank Moelis to help with a review of its brands, the report claimed.
The future of ‘a whole range’ of assets are under consideration, The Sunday Times reported, citing sources.
The Sunday Times said that a number of buyout firms, including the likes of Apollo Global Management Inc and CVC Capital Partners, are watching on with interest. The latter already has a hand in the gambling market, as it owns German bookmaker Tipico.
Entain has previously been the subject of failed bid attempts from MGM and Draftkings.
DS Smith closed down 0.3%. Sky News reported International Paper is closing in on a formal £5 billion-plus bid for the paper and packaging group.
A recommended offer from the US-based predator would still leave the door ajar for Mondi, DS Smith’s London-listed rival, to trump the International Paper bid, Sky said.
Both International Paper and Mondi have made all-share bid propositions for DS Smith.
A barrel of Brent oil fetched $89.93 at the London equities close on Friday, down from $91.31 on Thursday.
The respite in the oil price helped support shares in airlines easyJet, up 3.3%, and IAG, the owner of British Airways, up 2.3%, on hopes of lower fuel bills.
easyJet was given an additional push by UBS which reiterated a ’buy’ rating and raised its share price target to 850 pence each from 820p.
In London’s FTSE 250, shares in Currys gained 1.1% after The Sunday Times reported a shareholder has called on the consumer electronics seller to dispose of its mobile phone service division.
Fund manager JO Hambro said Currys should sell ID Mobile, a business which provides monthly phone contracts, the report claimed.
The Sunday Times said the division is valued at around £350 million.
JO Hambro holds a 4.5% stake in Currys and is the eighth-largest shareholder in Currys, the newspaper noted.
In March, Elliott Advisors announced it will not make an official bid for Currys, after having made a roughly £750 million proposal. JD.com, another potential bidder for Currys, also said it would not be making a bid.
On AIM, Mirriad Advertising leapt 37%. The provider of in-content advertising technology struck a deal with TripleLift, an operator of supply-side digital advertising platform.
As part of the pact, TripleLift will facilitate automated selling of Mirriad’s in-content advertising inventory into leading media buying platforms such as Google’s DV360.
In Tuesday’s UK corporate calendar, Imperial Brands releases a trading statement.
The economic calendar week has consumer and producer price inflation data for the US out on Wednesday and Thursday respectively, while inflation figures for China and the latest European Central Bank interest rate decision are also out on Thursday. On Friday, German CPI is out, alongside UK gross domestic product data.
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