US stocks have followed the FTSE 100 higher as investors are cheered by countries’ moves to ease some coronavirus restrictions.
Wall Street’s Dow Jones index climbed 0.3 per cent in morning trading. The S&P 500 rose 0.1 per cent and the Nasdaq gained 0.3 per cent.
Britain’s FTSE 100 index closed 1.1 per cent higher, breaking past 6,000 points for only the second time during the Covid-19 outbreak.
It rose in response to the UK government unveiling plans to ease the coronavirus lockdown and Vodafone reporting better-than-expected results. The FTSE 250 of mid-sized companies finished 0.6 per cent lower, however.
Stocks were mixed in Europe, where the continent-wide Stoxx 600 was up 0.3 per cent. Germany’s Dax was 0.1 per cent higher but France’s CAC 40 was down 0.2 per cent.
Markets have struggled for direction this week so far, despite countries setting out plans for easing coronavirus restrictions.
The FTSE 100 stayed roughly flat yesterday as markets were underwhelmed by the UK government’s “roadmap” for reopening, which many criticised as confusing.
However, investor sentiment has improved as more details have emerged. A key part of the plan for the economy is that people who cannot work from home have been asked to enquire with their employer about returning to work this week.
FTSE 100 lifted by Vodafone
The FTSE 100 was boosted by Vodafone, which revealed it would keep its dividend for 2019 and that it narrowed its losses substantially despite the coronavirus outbreak.
Vodafone booked a loss of €455m (£400m) for the financial year that ended in March, compared to a loss of €7.64bn the previous year. Shares in the telecoms firm closed nine per cent higher.
Asian markets’ closed lower overnight, however. This reflected “the pick-up of COVID-19 cases again in some countries which had reopened like South Korea,” said Jim Reid of Deutsche Bank.
Investors were particularly spooked by new cases in Wuhan, China, where coronavirus originated last year.
Ian Williams, economics research analyst at broker Peel Hunt said: “The rally in risk assets has run into resistance, as fears of a renewed rise in infections in Germany, Korea and Wuhan dulled some of the reopening enthusiasm.”
Chris Beauchamp, chief market analyst at trading platform IG said: “Western economies currently taking small steps towards re-opening and ending lockdowns will be examining the performance of China.”
Oil prices rose as investors weighed the reopening of economies. Brent crude was up 1.2 per cent at $30 per barrel. WTI crude was 5.1 per cent higher at $25.40 per barrel.
Craig Erlam, senior market analyst at currency firm Oanda, said: “It’s been a wild couple of months but we’re now seeing widespread action from producers to close the vast gap between supply and demand.”
The pound dropped 0.2 per cent against the dollar to $1.231. The dollar was down 0.5 per cent on an index against other currencies.