The FTSE 100 rose on Monday as stocks rallied in a broad risk-on rally sparked by optimism over the reopening of major economies.

Following weeks of strict lockdowns, Italy and Spain had begun lifting a number of measures which signalled a move back to some form of normality.

The United States has already begun an uncoordinated reopening with some states already allowing the resumption of trade for businesses such as hairdressers and bowling alleys.

President Trump has tabled the idea of a phased reopening but individual states have taken this as an opportunity to implement their own interpretation of an economic reopening.

The prospect of increased economic activity has caused a wave of optimism in markets with the FTSE 100 rising by 1.4% to 5,834 shortly before 12pm on Monday.

However, the reopening of economies has not been adopted in a globally coordinated basis and the UK still has no timeline or guidance on when the UK will start reopening it’s economy.

There is a consensus growing that countries must have a comprehensive testing programme in place to reopen businesses in a meaningful way.

The UK is yet to match other counties’ scale of testing so the UK government is likely to behind other governments in reopening the economy.

“We need to put in place a very dense testing regime so you would detect that rebound going back into exponential growth very quickly and not wait for the ICUs to fill up and there to be a lot of deaths. If you see the hot spot, you kind of understand the activities causing that,” said Bill Gates in an interview with CNN.

Stimulus and corporate results

The Bank of Japan was the latest central banks to release a round of stimulus as it announced it would make unlimited purchases of Japanese Government Bonds. Such a move would be considered extraordinary in normal circumstances but large purchases of assets by central banks has become the go-to response to COVID-19.

Deutsche Bank also added to the positive mood on Monday after it made a pre-annoucment of earnings which pointed to profit being towards the higher end of estimates.

Plant hire company Ashtead was the FTSE 100’s top riser on Monday as the company said profits would be largely inline with last year and the company’s status as an essential business had helped keep operations open.