On the first trading day of the year, London’s benchmark FTSE-100 index ended a good deal higher than at the beginning of 2020, when the new AstraZeneca vaccine was introduced in the UK.
The FTSE-100 was led higher by Ladbrokes owner Entain after it declined an offer from a U.S. rival. The index closed at 6,571.88 points, or 1.7 percent, up 111.36 points.
The index soared after the second vaccine developed by AstraZeneca and Oxford University was received by the first patients in the UK.
The close represented a pullback from the big highs of the index earlier in the day, however. An intraday high of 6,662 points was reported by the FTSE-100.
Soon after Downing Street announced that Prime Minister Boris Johnson would give a televised speech later in the evening to detail the next steps in the battle against Covid-19, the market started to pull back.
It was the first day that post-Brexit trade arrangements came into effect, ensuring U.S. banks would no longer go through London looking to buy European stocks.
Belinda Keheyan, Head of Marketing for the Aquis Exchange trading site, said the company moved all European stock trading from London to Paris seamlessly.
“It was a pretty significant day where overnight all European trading was moved from London to Paris, virtually 100 percent,” she told the PA news agency, adding that as years of planning had paid off, she had not learned of any disturbances.
A spokesman for the pan-European share trading platform Turquoise of the London Stock Exchange said on Jan. 4 she had “seen positive volumes on both Turquoise and Turquoise Europe”
Just before the pullback began in Europe, shares in the U.S. had also opened sharply lower.
Traders around the pond are fixated on the runoff elections for the Senate on Tuesday. In Georgia, the two races could mean that Democrats have control of both Congressional chambers and of the White House. A victory in both will mean that in the Senate, Republicans and Democrats are divided 50-50, with Vice President Kamala Harris taking the decisive vote.
“Contrary to the optimism emanating from Europe, the Dow Jones fell half a percent, retreating from a new all-time high,” said Spreadex analyst Connor Campbell.
“It’s understandably nervous – tomorrow is the runoff election for the Georgia Senate, which is just as important as the statewide election because the results will affect who leads the upper house of Congress.”
At the close in London, the Dow Jones was trading down about 1.7 percent, while the S&P 500 was down 1.5 percent .
Around the same time, at $1,3576 and €1,107, respectively, the pound lost 0.6 percent and 0.8 percent against the greenback and the single currency.
In Paris, the CAC-40 finished the day up 0.7%, while Frankfurt’s Dax gained less than 0.1%, dropping back from previous highs.
Entain led all FTSE companies in corporate news, finishing the day more than a quarter after refusing a bid of £ 8.1 billion from U.S. casino group MGM Resorts.
Ferguson finished the day down after deciding to sell its UK company Wolseley for £308 million, ending plans to list the unit separately.
S4Capital purchased Decoded and Metric Theory integrated agencies, and its stock ended 0.4 percent higher.
Entain, up 286.5p to 1420p, Fresnillo, up 119.5p to 1249p, Polymetal, up 157p to 1841.5p, Anglo American, up 147.5p to 2572p, and BHP Group, up 110p to 2035p, were the biggest winners in the FTSE-100.
Rolls-Royce, down 8.05 to 103.2 pence, IAG, down 9.95 to 149.85 pence, JD Sports, down 45.6 to 814.4 pence, NatWest, down 8.85 to 158.8 pence, and Taylor Wimpey, down 8 to 157.8 pence, were the biggest losers in the FTSE-100.