The FTSE 100 gained on Monday despite US futures falling after a bumper week for US equities last week.
US stocks had the best week since June on hopes lower inflation figures would see the Federal Reserve slow the pace of their interest rate hikes.
The FTSE 100 was up 0.4% at 7,346 while S&P 500 futures dipped 0.35% to 3,984. The tech-heavy NASDAQ rose over 7% last week and futures were down 0.55% on Monday.
“The burst of euphoria which erupted over US markets and spread more widely at the end of last week is ebbing away after fresh warnings that the fight against inflation is still a hard slog yet to be won,” said Susannah Streeter, senior investment and markets analyst Hargreaves Lansdown.
“This latest reminder comes from US Federal Reserve Governor Christopher Waller, who said at a conference in Sydney that the endpoint to rate increases is likely ‘ways off’.”
Analysts also once more raised the question of whether the recent gains in stocks were simply a ‘bear market’ rally that could be sold in to.
“The risk with any sudden surge in the stock market amid headwinds such as rising inflation and higher interest rates is that it is a short-lived event,” said Russ Mould, investment director at AJ Bell.
“It’s common to see a bear market rally when stocks are down, but they often cannot be sustained. To see many stocks and shares move higher for the second week in a row is encouraging but it’s too early to declare this a bona fide recovery rally.”
Frasers Group
Frasers Group was one of the biggest fallers on Monday on reports the retailer could be eyeing up Saville Row tailor Gieves & Hawkes. Frasers Group is famous for buying up distressed retail companies and Gieves & Hawkes fits the bill, albeit in a slightly different area of the market they are known for.
Frasers Group was down 6.9% at the time of writing.
Informa shares jumped 6.5% and were the FTSE’s top riser following a racketing up of full year revenue and profit targets.