Following a couple of stagnant sessions, the markets got what they were after on Thursday – another injection of trade deal optimism.
According to Reuters, via the Chinese commerce ministry, Beijing and Washington have agreed to gradually roll-back the costly tariffs imposed during the last few months of the trade war, in order to secure ‘phase one’ of a deal.
Again this isn’t the same as action, and is yet to be confirmed by the US, something that perhaps explains the restrained nature of the markets gains. And the signing of any agreement may be pushed until December, with London touted as a potential ‘neutral’ arena.
However, it continues a string of news stories pointing in the right direction, helping the European indices pop higher after the bell. The DAX added 0.6%, causing it cross 13260 for the first time in 21 months. The CAC, which has been on a remarkably confident run since the end of August, neared 5900 as it rose 0.4%, cementing another fresh 12-year peak.
Despite a 1% fall from BP (LON:BP), the FTSE managed to climb half a percent, pushing past 7400 to finally hit the levels it was at just before the bloodbath that opened October. It was an even better morning for the FTSE 250; the secondary index jumped 0.8% thanks to a 7.3% increase form Tate & Lyle (LON:TATE), an 8.7% surge from Aston Villa and a 5.7% rebound from Marks and Spencer (LON:MKS).
The pound, which has spent the week trickling lower against the dollar while making headway against the euro, wasn’t up to much on Thursday. It is going to be hard for anything but the loudest election news to make sterling pay attention, hence the mild 0.1% rise against the greenback and lack of movement against its single currency rival.
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