London’s top indexes kicked off the new trading week in positive fashion today, continuing a trend of wild swings on global markets.
The capital’s premier index surged 1.5 per cent to close at 7,121.81 points, while the domestically-focused mid-cap FTSE 250 index, which is more aligned with the health of the UK economy, added 0.45 per cent to hover around 19,000 points.
The strong start comes off the back of a hugely volatile trading week last week in which the world’s top stock markets plunged on concerns central banks may tip their respective economies into recessions by hiking rates rapidly to tame inflation.
Britain’s economy is being viewed as one of the most at risk of reversing in the developed world, mainly caused by a higher inflation peak eroding living standards and weighing on spending.
New cost of living figures are published tomorrow by the Office for National Statistics and are expected by markets to have edged above an already 40-year high of 9.1 per cent.
The Bank of England last week lifted rates for the fifth successive meeting, up 25 basis points to 1.25 per cent, as it scrambles to curb an expected 11 per cent inflation peak.
Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said: ‘’With the realisation the comfort blanket of cheap borrowing is being whipped away, investors are experiencing fresh chills at the start of the week.”
TMT giants led gains on the FTSE 100, with broadcaster ITV the second biggest riser, adding nearly seven per cent. Telecoms titan BT jumped a shade over three per cent.
The pound gained ground on the greenback, strengthening 0.17 per cent to $1.2244.