FTSE leaps on falling pound and vaccine hopes

The FTSE 100 jumped higher as equity traders welcomed a dip in the pound and speculation that a Covid-19 vaccine could be rushed out in time for Christmas.

Markets across Europe welcomed positive vaccine reports and positive comments from US treasury secretary Steven Mnuchin regarding a stimulus deal, shaking off weaker-than-expected jobs data in the US.

London’s top flight closed 78.9 points higher at 5,940.95 at the end of trading on Wednesday.

Connor Campbell, financial analyst at Spreadex, said: “Riding high on vaccine news, the markets weren’t hurt by a dramatically lower than forecast non-farm employment change reading.

“Already aggressive in their gains, the US open, and the falls for the pound and euro, ensured that the European session only got better.

“As for the FTSE … a smattering of losses across its oil and banking stocks were more than compensated for by the stellar growth for its housebuilders.”

Europe’s other major markets recovered most of the losses they suffered from slumps in the previous two sessions as they benefited from the broad uptick in sentiment.

The German Dax increased by 2.07%, while the French Cac moved 1.9% higher.

Across the Atlantic, the Dow Jones opened higher as traders particularly pinned their hopes on suggestions that US politicians can reach a bipartisan agreement to steady the economy.

Meanwhile, sterling’s recent purple patch came to an end, as it slumped on a positive move by the dollar and the Prime Minister stating that major differences still exist between the UK and the EU in relation to reaching a deal.

The pound fell by 0.46% versus the US dollar at 1.33 but was up 0.48% against the euro at 1.125.

Property firms and housebuilders lifted higher on Wednesday after the Office for National Statistics revealed that house-buyers shrugged off continued uncertainty in the economy to push prices higher.

A positive update from Barratt also helped to improve sentiment, with the Leicestershire-based firm saying it has been encouraged by “very strong consumer demand” in recent months.

Barratt closed 43.8p higher at 547.4p despite revealing that pre-tax profit fell 46% to £491.8 million for the past year on revenue of £3.42 billion, a drop of 28%.

Elsewhere, shares in The Gym Group slipped after it saw revenues for the past six months cut by almost half and swung to a loss following the pandemic.

The company, which operates 183 gyms across the country, said it made “virtually no revenue” after shutting sites at the end of March. Shares closed 6.8p lower at 150p.

Mining giant Fresnillo slumped by 42.5p to 1,277.5p after the mining giant was impacted by a slump in silver prices for the second consecutive day.

The price of oil slid due to increased volatility following the publishing of the EIA report which showed that oil and gasoline inventories tumbled.

The price of a barrel of Brent crude oil decreased by 2.86% to 44.56 US dollars.

The biggest risers on the FTSE 100 were Barratt, up 43.8p at 547.4p, Taylor Wimpey, up 8.4p at 126.05p, Persimmon, up 144p at 2,695p, and Rolls-Royce, up 10.9p at 217.6p.

The biggest fallers of the day were Polymetal, down 69p at 1,963p, Fresnillo, down 42.5p to 1,277.5p, Flutter, down 325p at 11,730p, and Barclays, down 2.4p at 103.5p.