Top-flight shares continued their good run on Thursday after slightly better-than-expected Chinese economic data.
The FTSE 100 Index rose 92 points to 6,153 in the first hour of trading as China's manufacturing purchasing managers index (PMI) rose unexpectedly in September.
The PMI showed a reading of 49.8, while the estimates were to remain stable at 49.7, representing the first increase after three months of consecutive declines.
Chief market strategist at ADS Securities, Nour Eldeen Al-Hammoury, noted that the index remained below the 50 key level, but said the surprise figure had eased fears about a faster slowdown, keeping market sentiment positive.
Markets in France, Germany and Italy were all in positive territory amid mixed PMI manufacturing data for September.
The overall PMI figures for the Eurozone came in at 52.0, down from 52.3 in August, with any figure above 50 indicating expansion. France returned to growth, leaving only Greece in contraction. UK September manufacturing PMI dropped to 51.5, slightly above a forecast of 51.3.
Howard Archer at IHS Global Insight said: "Marginally softer Eurozone manufacturing expansion in September, according to the PMI, indicates that the eurozone’s modest cyclical upturn is continuing but failing to kick on."
On the corporate front, oil giants were up on rising crude prices. BP (LON:BP.) gained 8.4p to 342.4p and Royal Dutch Shell (LON:RDSB) increased 29p to 1592p as the price of a barrel of Brent crude rose 0.8% to US$48.7.
Meat producer Cranswick (LON:CWK) sizzled up 36p to 1632p after first-half revenue came in slightly above its expectations.
Shares in US miner Atlantic Coal (LON:ATC) ticked up 0.02p or 14.4% to 0.15p on news of an "excellent" third quarter for production and sales, helped by buoyant anthracite prices.
Caza Oil & Gas (LON:CAZA) fell 0.75p to 0.75p after saying it was at an advanced stage of talks over a potential equity financing.
MARKET PREVIEW
London’s blue-chip stocks are set for a positive start to Thursday as encouraging economic stats in America boosts sentiment in equity markets.
Wall Street’s Dow Jones had added some 235 points, 1.47%, by Wednesday’s close after American private company jobs figures were better than expected, which gave confidence ahead of potential pivotal non-farm payrolls for September.
The S&P 500 gained just shy of 36 points, or 1.9%, to 1,920 while the Nasdaq moved 2.3% higher to 4,620.
Positive sentiment rolled over into Asia where Japan’s Nikkei climbed more than 400 points, 2.4%, to 17,802 and Hong Kong’s Hang Seng gained 1.4% to 20,846.
Also rising was the Shanghai Composite which added 0.48% to 3,052.
Australia’s ASX 200 was 90 points or 1.8% higher at 5,111.
In London, at 7:00 am, IG Markets called the FTSE 100 some 88 points to the good at 6,138 to 6,140.
Elsewhere, CMC Market’s analyst Michael Hewson described the last quarter as one that investors would prefer to forget.
“The big question now is whether yesterday’s rebound is a harbinger of a change in sentiment or merely a “dead cat” bounce? Today’s open suggests the rebound has some legs,” he said in a note.