FTSE 100 closes higher amid trading optimism over China

The FTSE 100 pushed marginally higher on a subdued trading session as investors hoped stimulus from China can help to ease pressure from the spread of coronavirus.

London’s top flight closed 24.12 points higher at 7,433.25 at the end of trading on Monday.

European equities nudged higher amid trading optimism despite concerns from analysts that the rapid spread of the virus could have a significant impact.

Craig Erlam, market analyst at Oanda, said: “The numbers we’re seeing are already pretty dreadful to say the least and they’re continuing to rise, with the death toll above 1,700.

“That’s more than double Sars and it’s still rising at a fairly rapid rate. When you consider that only a few weeks ago people were fearing it could be as bad, the reality is really quite shocking.”

Stocks in China surged after the People’s Bank of China offered 29 billion US dollars’ (£22.3 billion) worth of one-year medium-term loans.

Meanwhile, sterling slipped ahead of a busy week for UK data, with economists expecting to see a slight drop in wage growth on Tuesday, while inflation is expected to increase sharply on Wednesday.

The value of the pound decreased 0.23% versus the US dollar at 1.301 and slid 0.2% against the euro at 1.200.

The major European markets also made modest improvements as traders were encouraged by a quiet day largely free of incident.

The German index moved near to an all-time high despite the Japanese economy contracting by 1.6% in the fourth quarter.

The German Dax increased by 0.29% while the French Cac moved 0.27% higher.

Elsewhere, traders had the day off across the Atlantic for the President’s Day holiday, helping to contribute to the calmness throughout the session.

Laura Ashley store in the Brunel Retail Park in Reading
Laura Ashley store in the Brunel Retail Park in Reading

In company news, shares in Laura Ashley plummeted after the retailer said it is desperately trying to unlock more money from one of its main lenders after Wells Fargo started to tighten the purse strings.

The company said its majority shareholder, MUI Asia Limited, is “discussing arrangements” that could allow Laura Ashley to draw on more cash from the US bank.

The company closed 1.2p lower at 2p as a result.

Elsewhere, the founder of scandal-hit hospital-builder NMC Health has been forced to leave the board after questions over the group’s finances and its ownership.

BR Shetty, an Indian-born Emirati businessman, stepped down as non-executive chairman, and from the board altogether, on Sunday, the company said.

Subsequently, shares in the firm increased by 25p to 800p at the close of play.

Shares in Just Eat Takeaway.com edged lower after it said it was “confident” its multibillion-pound merger will be cleared by the competition watchdog as it issued new company shares. Shares dipped 100p to 7,700p.

Provident also saw shares dip after its car finance arm Moneybarn was fined almost £3 million after failing to help vulnerable customers. Shares were down 4p to 465p.

The price of oil moved marginally higher although trading was subdued. The price of a barrel of Brent crude oil fell 0.07% to 57.3 US dollars.

The biggest risers on the FTSE 100 were NMC health, up 25p to 800p, Kingfisher, up 5.3p at 222p, Auto Trader, up 13.8p at 602.8p, and Centrica, up 1.38p at 72.64p.

The biggest fallers on the index were Segro, down 28.4p at 906.6p, DS Smith, down 7.3p at 358.6p, Tui, down 17.4p at 880p, and RBS, down 4.1p at 209p.