The FTSE 100 has rallied ahead of the US election up 79 points or 1.4% at 5735.
Almost every stock on the FTSE 100 opened higher on Tuesday morning, recovering from the 7-month lows.
The FTSE 250 rose 1.35% to 17,412.93.
It wasn’t just London that opened higher. Stocks across Europe climbed on Tuesday with Germany’s DAX index and France’s CAC both climbing around 0.6% on opening representing a one-week high.
Connor Campbell from Spreadex commented on the markets ‘blue wave’ on Tuesday: “The markets tempted fate on Tuesday morning, forgetting the lessons of 2016 as they pre-emptively celebrated a Joe Biden victory.
“The Democrat is the clear favourite – though Trump, that unkillable movie monster, can never be counted out, especially since Biden’s chances tightened over the weekend according to SpreadEX’s prices.
“Since last Friday, the Democrat has moved from a fixed odds price of 4/11 to 1/2, with Trump going in the other direction, from 15/8 to 7/5.
“Choosing to ignore the slim – but not slim enough – likelihood of Trump winning a 2nd term, the markets continued to aggressively rebound on Tuesday. This also meant they were fairly sanguine in the face of the idea that Trump may not react well to defeat, and the myriad horrible ways that could play out.
“The main reason why a Biden win is so sought after from a market-perspective, is that a ‘blue wave’ – i.e., the Democrats crucially taking the Senate – would see a stimulus plan far greater than anything Republicans would be willing to go for.
“That’s why you have the FTSE up 1.2%, and the DAX and CAC up 1.5% apiece – investors have gotten a sniff of stimulus, overriding any fears over uncertain results, recounts or a refusal to move out of the White House by the incumbent,” he added.
In Asia, stocks were also strong. China’s CSI 300 index climbed 1.2%, and Hong Kong’s Hang Seng increased by almost 2%