FTSE CLOSE: London stocks finish 100 points higher despite coronavirus second wave fears

The London markets surged higher as a string of positive economic figures helped traders to overcome fears over a possible second wave of coronavirus.

Better-than expected manufacturing PMIs across the globe drove sentiment higher after a subdued start to the trading session.

The FTSE 100 closed 135.09 points higher at 6,032.85p at the end of trading on Monday.

Connor Campbell, financial analyst at Spreadex, said: “After a rocky start, the Western markets blossomed as August’s trading got under way – even if there was plenty out there to undermine Monday’s aggressive gains.

“Despite the ongoing threat of a second wave of coronavirus cases in mainland Europe, and the UK government’s various lockdown U-turns in the past few days, the region’s indices were positively giddy this Monday.

“That’s in part due to a string of better than forecast manufacturing PMIs for July, with Spain and the US ISM figure the standouts.”

In the UK, the closely watched IHS Markit/CIPS manufacturing purchasing managers’ index (PMI) hit a score of 53.3 last month, slightly surpassing analyst expectations.

Stocks closed higher in Europe, as traders chose to cast aside concerns that US politicians still have not reached a compromise regarding the one trillion dollar stimulus package.

The German Dax increased by 2.71%, while the French Cac moved 1.93% higher.

Across the Atlantic, the Dow Jones followed Europe’s lead to nudge higher, albeit slightly less enthusiastically, amid strong demand for tech stocks.

Meanwhile, sterling’s strong recent streak was ended by a rebound in the value of the dollar, after the US greenback had hit a two-year low on Friday.

In company news, HSBC was the biggest faller on the FTSE 100 after it suffered a 65% drop in pre-tax profit in the first half of the year following a dive in interest rates and coronavirus disruption.

The bank reported profits of 4.3 billion US dollars (£3.2 billion) in the half year to June 30, down from 12.4 billion dollars (£9.5 billion) in the same period in 2019.