Global markets hit records as trade deal thought to be close
The Dow Jones index hit a record high on Monday as hopes over the future of trade relations between the United States and China pushed up global markets, including the FTSE 100.
Investors expecting that a trade deal, or at least the first step towards one, could be signed shortly, pushed the Dow Jones to beat its record, France’s Cac to hit a 12-year high and the Dax to levels not seen since the middle of 2018.
“US commerce secretary Wilbur Ross, though not part of the actual negotiating team, lit a fire under the markets with his optimistic comments regarding the likelihood of Presidents Trump and Xi putting pen to paper in the coming weeks,” said Connor Campbell, an analyst at SpreadEx.
“He also said that licences for US firms to restart selling components to Huawei would also be arriving sharpish,” he added.
US President Donald Trump, as the Dow hit 27,500 for the first time in history, tweeted: “Stock Market hits RECORD HIGH. Spend your money well!”
London’s FTSE 100 was dragged higher by its miners, even Antofagasta, which warned that it would lose 10,000 tonnes of copper production from protests in Chile, which shut down roads to its mines. This is twice the amount in past estimates.
The blue-chip index closed up 67.27 points to 7,369.69.
Unlike its US and European counterparts – some of which hit year, decade or all-time highs – this was merely a return to September levels.
Meanwhile, the pound was down against the dollar by 0.18% to 1.2907, against the euro it rose 0.06% to 1.1586.
In company news, UK gambling firms saw their shares dive after MPs called for a crackdown on online casinos.
Betting firms such as Ladbrokes-owner GVC, which also appointed a new chairman, Betfair-owner Flutter Entertainment and William Hill all saw their shares slip on Monday, after a cross-party group of MPs called for an overhaul of online gambling to protect vulnerable people.
The All-Party Parliamentary Group for Gambling Related Harm called for a limit on maximum bets for online slot machines, similar to a recent cap introduced for fixed-odds betting terminals (FOBTs).
Mothercare has become the latest UK retailer to feel the pressure of the recent downturn affecting the high street.
The baby product business has announced plans to appoint administrators for the UK retail arm after years of tumbling sales and periodic shop closures.
The fund formerly run by under-fire manager Neil Woodford has slashed the value of its stake in a Brad Pitt-backed nuclear energy company.
Woodford Patient Capital Trust, which is under new management, cut the valuation of its holding in Industrial Heat, an unproved cold fusion venture, by £45 million.
Oil prices were also buoyed by hopes of a trade deal, with Brent crude up 1.7% to 62.74 dollars.
The biggest risers on the FTSE 100 were NMC Healthcare, up 126p to 2,351.00p, Glencore, up 11.25p to 252.20p, Smurfit Kappa, up 122p to 2,758.00p, Rio Tinto, up 126p to 4,294.00p, and Kingfisher, up 6.2 to 215.30p.
The biggest fallers on the FTSE 100 were Flutter Ent, down 278p to 7,932.00p, Hiscox, down 35p to 1,440.00p, Land Securities, down 18.2p to 914.00p, JD Sports, down 11.8p to 758.20p, and British Land, down 8.8p to 602.80p.