As economists pinned their hopes on recent optimistic developments around successful Covid 19 vaccines, global markets rallied Tuesday.
The Organization for Economic Cooperation and Development (OECD) noted that progress on care had “raised expectations” and mitigated uncertainty.
Traders welcomed the news in London as stocks rallied.
At Tuesday’s end of trade, the FTSE 100 closed 118.54 points higher at 6,384.73.
David Madden, CMC Markets UK market analyst, said, “The positive move on Tuesday in the FTSE 100 is largely a complete reversal of the negative move on Monday.”
For Covid-19, expectations continue to circulate around vaccine production, with the OECD now estimating that global GDP will contract by 4.2 percent this year, an increase of -4.5 percent on the previous estimate.’
“Bullish sentiment is seen across the board, with hospitality, transportation, travel and real estate stocks also higher.”
Trading optimism was also high elsewhere in Europe as French stocks rallied on Emmanuel Macron’s initiative between April and June for a large-scale Covid 19 vaccination campaign in France.
The Dax of Germany was 0.27% higher, while the Cac of France gained 1.14% .
Across the Atlantic, after the bell, the Dow Jones rose almost 400 points and was just a touch away from its all-time peak.
Meanwhile, the pound continued to rise against a weak U.S. dollar, although it lost ground against the euro as Brexit talks escalated.
The pound rose 0.53 percent to 1.339 against the U.S. dollar and was 0.41 percent lower to 1.112 against the euro.
The administration of Topshop owner Arcadia Group and the imminent liquidation of Debenhams gave a boost to a range of retail stocks.
After the 242-year-old department store chain announced plans to permanently close all of its stores, shares in Marks & Spencer, one of Debenhams’ biggest rivals, soared. At 132.75p, M&S closed 7p higher.
Fashion chains like Next, Joules and JD Sports, which on Monday pulled out of a potential Debenhams rescue contract, all made good gains.
In corporate news, after buying stevia producer Sweet Green Fields, FTSE 100 sugar giant Tate & Lyle reported profits.
At Tuesday’s end, shares rose 16 pence to 653.8 pence.
Despite a loss for the year, Topps Tiles shifted into profit as the business recorded a turnaround in revenue thanks to a boom in the home improvement market.
After announcing a 16.5% jump in like-for-like revenues in the latest quarter, the firm closed 0.4 pence higher at 56.4 pence.
After Cabinet Secretary Michael Gove said they would be considered a “essential meal” in a Tier 2 food service institution, shares in food-to-go supplier Greencore, one of the UK’s largest producers of Scotch eggs, jumped.
At 124 pence, shares ended 6.9 pence higher.
After OPEC+ failed to reach an agreement on future output plans, oil prices dropped.
The price of a Brent crude oil barrel dropped 0.25 percent to $47.54.
Taylor Wimpey, up 12.1 pence to 166.05 pence, Melrose, up 11.9 pence to 165.4 pence, Lloyds, up 2.65 pence to 38.27 pence, and Persimmon, up 183 pence to 2,839 pence, were the biggest gainers in the FTSE 100.
Aveva Party, down 21 pence to 3,181 pence, Hikma, down 127 pence to 2,481 pence, Avast, down 22.8 pence to 485.2 pence, and Unilever, down 137 pence to 4,434 pence, were the biggest losers in the FTSE 100.