Markets rise as China set to ramp up imports from US farmers

Markets jumped higher on Friday as Washington and Beijing entered the weekend as friends.

The FTSE 100 rose by 68.53 points to 6,292.6, a 1.1% change on the day before.

It came as reports emerged that China will start buying more American agricultural goods, in a sign of a thaw in the tense relationship between the two countries’ governments.

It fulfils the first part of last year’s trade agreement between the Trump White House and the Chinese Communist Party.

But analysts cautioned against reading too much into what on the face of it is good news.

“Though there is plenty of reason to be worried about the relationship between the two superpowers – just yesterday the president tweeted that the US ‘certainly does maintain a policy option, under various circumstances, of a complete decoupling from China’ – a commitment to fulfilling the terms of the phase 1 trade agreement can be read as a positive,” said Connor Campbell at Spreadex.

The FTSE was pushed higher by Aveva and Taylor Wimpey, the latter making up lost ground from Thursday when it announced plans to sell more than £500 million worth of new shares.

“It helped enormously that the pound struggled against dollar and euro alike,” Mr Campbell said as sterling hit its lowest point against the US currency since the beginning of the month.

The FTSE 100 is normally boosted by a falling pound, which makes British shares and exports cheaper for foreign buyers.

Against the dollar, it fell 0.6% to 1.2357, while losing 0.4% against the euro to 1.1046.

The S&P 500 was up 0.2% and the Dow Jones rose 0.1%.

In Europe, both the German and French markets rose, with the Dax and Cac 40 up around 0.4%.

In company news, Anglo-Australian mining giant Rio Tinto closed down by 0.5% on the day it bowed to pressure from campaigners to publish a report into why it blew up a 46,000-year-old heritage site in Australia.

Chief executive Jean-Sebastien Jacques said the company needs to regain the trust of local Aboriginal people amid a storm over its decision to blast at the Juukan Gorge site.

Oil services giant Wood Group dropped by 1.1% on the news that earnings dropped by a fifth due to coronavirus and a battered oil price. Revenue, meanwhile, was down 11%.

Its shares were likely helped by a rising oil price, as Brent added 1% to 41.95 US dollars per barrel.

The biggest risers on the FTSE 100 were Aveva up 177p at 4,161p; Taylor Wimpey up 6.2p at 148.95p; United Utilities up 38.6p at 978.2p; Diageo up 95p at 2,900p and 3i up 27.6p at 844.2p.

The biggest fallers were Whitbread down 68p at 2,365p; Land Sec down 17.2p at 605.8p; British Land down 7.5p at 405.2p; Berkeley Group down 78p at 4,304p and Barclays down 2.08p at 116.56p.