The FTSE 100 staged a mini-resurgence on Tuesday morning, climbing by just over 1%, but not quite back above the 7,000 mark.
“Bargain hunters appeared to be out in force on Tuesday as the FTSE 100 bounced back from a torrid start to the week,” says AJ Bell investment director Russ Mould.
“The miners, scarred by heavy selling on Monday, eked out a recovery while British Airways owner International Consolidated Airlines continued the ascent which begin yesterday afternoon when the US lifted travel restrictions on fully vaccinated UK and EU visitors.”
A major factor in market volatility of late has been fears about the fall-out from a potential collapse of Chinese property developer Evergrande, and the concerns have not gone away.
“Evergrande is due to make a debt repayment on Thursday and this event could be the next major test of investors’ resolve.”
“The challenge for the markets is trying to guess how Beijing might react, particularly after its notably strident approach in recent months when it comes to the technology industry. Will it be similarly strict with the property sector?
Before Thursday there is also the latest US Federal Reserve meeting and the question of whether recent events will lead chair Jay Powell and his colleagues to rethink their plans for tapering financial stimulus.
FTSE 100 Top Risers
IAG (5.04%), Pershing Square Holdings (4.14%) and Shell (4.03%) are leading the way on Tuesday, each with sizeable gains.
At the other end, Kingfisher (-4.71%), Compass Group (-1.93%) and Polymetal International (-0.95%), were all in the red.