As the mood of investors was beginning to become a concern, markets bounced back from a weak start to the week. The FTSE 100 was up 1% to 7,109 as “investors piled into airlines and retail stocks, suggesting that the Covid delta variant is no longer considered to be a major concern,” according to Russ Mould, investment director at AJ Bell.
Following a month in the red, Associated British Foods climbed by 5.19% on Thursday on the back of a strong trading update. AO World, the Bolton-based electrical retailer, said its new financial year made a good start and PZ Cussons said it is raising prices to deal with inflationary pressures.
“These nuggets of information are very important to investors as they are proof that many businesses are holding up as the world returns to normal, and not struggling following the initial post-lockdown boost where pent-up demand saw a widespread spending spree by consumers. It was a similar story yesterday from Dixons which said trading continued to be strong,” said Mould.
The FTSE 250 climbed by 1% thanks to a push from airlines and property-related stocks such as Grafton and Howden Joinery, both reaping the rewards from more people doing up their homes. In Europe, the Euro Stoxx 50 advanced 1.1% with banks, utilities and energy companies leading the way.
“These strong market gains could serve to fire up investors and help them to regain confidence in equities. The key challenge is to sustain the positive performance as it could only take a few down days on the market for investors to turn gloomy again,” Mould said.
FTSE 100 Top Movers
Associated British Foods (5.12%), Fresnillo (4.33%) and IAG (3.99%) are heading up the FTSE 100 on a day of solid gains across the index.
At the other end, B&M European Value Retail (-2.09%), London Stock Exchange Group (-1.1%) and Admiral Group (-0.83%), have made the biggest falls so far on Thursday.