The FTSE 100 was on track for its fourth consecutive day of gains, flirting with the 7,000 level once again as investors bid up shares in multiple sectors including energy, pharmaceuticals and mining
Investors appear to have regained optimism after the U-turn in UK government policy and hopes that the new earnings season that kicked off last week might not be as bad as feared.
Russ Mould, investment director at AJ Bell, said: “Bank of America beat expectations yesterday with its latest results, while last week we saw better than forecast numbers from UnitedHealth, JPMorgan, Wells Fargo, Taiwan Semiconductor, Louis Vuitton and PepsiCo. Later today we get figures from Johnson & Johnson and Netflix, while numbers are due in the following days from the likes of Tesla, Procter & Gamble, ASML and Danaher.
“As a bellwether for the media sector, advertising group Publicis helped breathe some positivity into the markets by raising its full-year outlook for the second time this year. There had been worries that advertising companies would see a sharp downturn in trading if corporates scaled back promotions for fear that consumers would be less willing or able to buy their products. That had a positive read-across to WPP whose shares jumped 4%.
“Also helping to drive more positive investor sentiment were reports that the Bank of England might delay further sales of government bonds until markets settle down. There had been some concerns that the Bank selling bonds would push down prices and push up yields just at the point when the cost of government borrowing was starting to come back down. After the chaos we’ve seen in recent weeks, markets could really do with some calm.”