London stocks gain on bumper EU stimulus, vaccine hopes

Credit: REUTERS/Suzanne Plunkett

By Sagarika Jaisinghani

July 21 (Reuters) - UK shares rose on Tuesday, tracking European markets following a massive stimulus deal to prop up battered EU economies, while positive data from an array of COVID-19 vaccine candidates fuelled global optimism for a second session.

The blue-chip FTSE 100 .FTSE gained 0.5% and the mid-cap FTSE 250 .FTMC rose 0.9%, led by autos .FTNMX3350, banks .FTNMX8350 and life insurers .FTNMX8570.

Stock markets in Europe .STOXX surged to their highest in more than four months following the "historic" stimulus that paved the way for the EU's executive arm to raise billions of euros on capital markets on behalf of all 27 states. .EU

Also boosting sentiment, developers published promising early data from trials of three potential COVID-19 vaccines on Monday, including a closely watched candidate from Oxford University.

The lead developer at Oxford University's trial said on Tuesday it was possible the vaccine could be rolled out by the end of the year, but also warned there was no certainty that would happen.

"Risk assets are moving to the vaccine pump's beat after it was raining positive vaccine trials overnight, and investors are still dancing in that rain," said Stephen Innes, markets strategist at AxiCorp.

The FTSE 100 is on course to gain for a fourth straight month, following a coronavirus-driven crash in March, boosted by easing lockdowns and improving economic data. Focus has now turned to quarterly corporate earnings updates to gauge the pace of a post-pandemic business recovery.

Ted Baker soared 9.4% and was on course for its best day in more than a month as the struggling fashion retailer said its performance was ahead of a base case scenario.

However, Ladbrokes owner GVC Plc GVC.L slumped 7.8% after saying British tax authorities had expanded an investigation into the gambling company's former online business in Turkey to include unidentified entities within the group.

(Reporting by Sagarika Jaisinghani in Bengaluru, Editing by Sherry Jacob-Phillips)

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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