FTSE 100 shares closed 1.7% higher on Monday as a sharp intraday gain came early in the session on news that US presidential candidate Hillary Clinton had been cleared by the FBI, and it remained on helium for the rest of the session.
Mining stocks led the gains, reacting to rising commodity prices.
Although the euphoria may or may not play out on election day on Tuesday, the timing on Sunday of the all-clear is important for Clinton, who clinched a lead against rival Donald Trump in the latest opinion poll on Monday.
Markets were risk-on following the Clinton news, although the FTSE 100 had only just recovered to levels seen on Thursday. The FBI first announced a second probe into Clinton’s emails 11 days ago.
The blue-chip ended up 1.7% at 6,806 and led by miner Antofagasta Holdings (LON:ANTO) up 6.3% to 565p. Next in line gaining were miners Glencore (LON:GLEN), Anglo-American (LON:AAL) and BHP Billiton (LON:BLT).
Fresnillo (LON:FRES) and Randgold (LON:RRS), though, fell.
The fifth-biggest riser was banking giant HSBC (LON:HSBA), up 4.6% to 622.3p after the bank reported its third-quarter results. Pre-tax profits at the bank fell sharply due to a host of one-off charges, but adjusted profits rose 7% to a better-than-expected $5.6bn.
Staying with banking, shares in Tesco (LON:TSCO) were the third-biggest faller of 1.1% to 200.2p after the retail giant said money had been taken from 20,000 Tesco Bank customers.
About 40,000 accounts saw suspicious transactions over the weekend, Tesco said, and the bank has suspended all online transactions.
The FTSE 250 mid-caps gained 1.1% to 17,457, and led by Countrywide plc (LON:CWD), up 6.3% to 190.4p on no specific news.
More modest gains among small-caps, with the FTSE AIM 100 Index up 0.3% to 3826 and the FTSE AIM All-Share Index up 0.04% to 802.
London gainers were 39% of the bourse and losers 25%.
Midsession
FTSE 100 up 100 points on talk of Clinton victory
Wall Street to start Monday higher ahead of election
HSBC higher on dividend payout hopes
Tesco suspends current accounts after hacking attack
Ryanair posts increased profits despite initial Brexit fears
London’s FTSE 100 added 100 points, 1.5%, to trade at 6,795 with about an hour of Monday’s session remaining.
Positioning ahead of the US presidential election remained the dominant theme.
Seemingly the financial markets are pricing in a win for Hillary Clinton.
The stock market has been discounting drug makers in the months running up to tomorrow’s US presidential election – so why are GlaxoSmithKline and AstraZeneca on the rise even though a Clinton victory is being predicted.
Well, according to the boffins at Citigroup these two London listed companies may be among the better positioned in their sector to deal with a presumed clampdown on pharmaceuticals and drug pricing.
On Monday, Glaxo was up just over 1% to £15.44 whilst AstraZeneca was some 1.2% higher at £44.20.
FTSE 100 holds gains as markets price in Clinton win - 12:30
London’s FTSE 100 was up 91 points, 1.4%, trading at 6,785 at lunch on Monday.
HSBC Holdings Plc (LON:HSBA) was one of the notable winners, up 4.8% to 623.25p, after dividends were the focus of its third quarter results.
International miners, meanwhile, also strengthened with Glencore Plc (LON:GLEN), Antofagasta Plc (LON:ANTO), BHP Billiton plc (LON:BLT) and Rio Tinto Plc (LON:RIO) all among the other notable risers.
Significantly, the US dollar was rallying.
“Financial markets are starting to price in a victory for Hillary Clinton on Tuesday, after the FBI cleared her of any criminality regarding her email server issue,” said Kathleen Brooks, research director at City Index.
Brooks highlighted that most of the activity is in the forex market, while retail investors aren’t really buying into equities. She notes that City Index clients aren’t “whole-heartedly diving into this stock market rally” and the FTSE 100 is ‘still 54% sold’.
“Overall, we will be watching what our clients do closely over the next few days,” she added.
Brooks added: “While the FX market appears to be solely focused on the US election outcome, the way the retail market is trading stocks is more interesting.
“Our clients may be cautious on stocks for the long-term if the Fed signals that it will embark on a rate hiking cycle, which is more likely under a Clinton Presidency, then we could see any stock market rally cut short in the coming days.”
FTSE 100 holds gains as markets price in Clinton win - 11:00
The FTSE 100 held onto the gains it made this morning as markets seem to grow increasingly confident that Hilary Clinton – viewed as the ‘safe option’ – will emerge victorious in tomorrow’s elections.
The blue chip index was up 91 points to 6,785 at 11am on Monday morning.
Low cost airline Ryanair Holdings PLC (LO:RYA) was flying high this morning after bucking its own Brexit concerns to post increased passenger numbers and profits in the six months to September.
Fevertree Drinks PLC (LON:FEVR) was also bubbling away nicely, up 10% after telling the market that it would be “materially ahead” of expectations (again) for its full-year results.
In the small caps, it wasn’t such an enjoyable Monday for E2V Technologies PLC (LON:E2V), which was down more than 15% after “challenging trading conditions” hit performance in its first half.
FTSE 100 continues its rise - 10.15am
London’s blue chips were in buoyant mood on hopes that Hillary Clinton is on the way to victory in the US presidential election.
Overnight the FBI said there was nothing criminal in her email behaviour, sparking fierce criticism from her rival Donald Trump but seemingly ending the scandal that had threatened to engulf her campaign.
The blue chip index added 88 to 6,781. Curiously pharmaceutical groups are leading the way with AstraZeneca up 30p to 4,399p and GlakoSmithKline 17p better at 1,545p.
Curbing drug prices is a key part of the Clinton manifesto and according to Citigroup today: “The full breadth of potential policy options for US healthcare reform creates almost limitless outcomes.”
Halifax reported that house prices rose 1.4% month-on-month in October, which was the largest increase since March and alongside a bullish write-up, also from Citigroup, nudged Persimmon 10p higher to 1,670p.
Base metal miners were strong with BHP Billiton plc (LON:BHP) up 3.5% to 1,207p.
The upbeat mood was also sufficient for investors to forgive HSBC (LON:HSBA) an 86% decline in third quarter profit due to US$5.4bn of currencies and one-off costs.
Analysts said the capital position was much better than expected and that bodes well for future dividends. HSBC shares jumped almost 5% to 623.6p.
Tesco (LON:TSCO) slid 2.2% to 200.4p on news it had suspended online payments for current account customers with 20,000 now reported to have had money removed over the weekend through a hacking attack.
Among the smaller caps, mixer drink specialist Fevertree looks set to deliver another sparkling performance this year after a bullish trading update.
Investec upped its upped its profit forecast by 17% and its target price to 1,140p. Shares rose 10% to 1,064p.
Keywords Studios PLC (LON:KWS) also did well, rising 9% to 464p. The video games services provider also said today that it expects to beat full-year expectations as a result of the continued strong performance of its recent acquisition, Synthesis.
Redcentric PLC (LON:RCN) though had a shocker down 68% to 48p.
An internal review by the IT services provider has found “misstated accounting balances”. When corrected, the group’s net assets will likely be reduced by £10mln.
FTSE 100 climbs as markets sense Clinton victory - 8.30am
London’s blue chips were up 84 points at 6,776 in early trades as polls suggested Hillary Clinton had stretched her modest lead in the race for the White House after the FBI said there was nothing criminal in her email behaviour.
Base metal miners were early beneficiaries with BHP Billiton plc (LON:BHP) up 3.5% to 1,207p.
The upbeat mood was also sufficient for investors to forgive HSBC (LON:HSBA) an 86% decline in third quarter profit due to US$5.4bn of currencies and one-off costs.
This included US$500mln for UK customers and a US$1.7bn loss on the sale of its Brazil business.
Tesco (LON:TSCO) slid 2.4% to 197.6p on news it had suspended online payments for current account customers with 20,000 account now reported to have had money removed over the weekend through a hacking attack.
Tesco Bank said there were 40,000 suspicious transactions over the weekend half of which saw money go out.
FTSE 100 to bounce back after Clinton receives all-clear – 7.00am preview
The Footsie looks set to start the week on the comeback trail, as hopes rose of a Clinton victory in the US presidential election.
Clinton’s chances of winning the election had been rocked by a new FBI investigation into her emails, but over the weekend it was revealed that the latest investigation into emails sent and received by her aide, Huma Abedin, had revealed nothing to be alarmed about.
The latest average of opinion polls had Clinton holding a small 1.8 percentage point lead over Trump.
Spread betting quotes point to the top-share index opening at around 6,768, after it finished last week at 6,693.
US markets had a bad day on Friday, with the S&P 500 dipping 3.5 points to 2,085, but Asian markets have been firm this morning, with the Nikkei 225 in Japan Up 1.6% 17,177 and the Hang Seng in Hong Kong 0.9% better at 22,846.
In the UK, banking giant HSBC Holdings PLC (LON:HSBA) has just announced and adjusted third quarter profit before tax of US$16.68bn, down 6% year-on-year.
Publishing powerhouse Informa PLC (LON:INF) said it remained on track to meet full-year expectations as it released a trading update for the first nine months of the year.
Around the markets
Sterling: US$1.2433, down 0.86 cents
Gilts: 10-year yield = 1.025%
Gold: US$1,290.50 an ounce, down US$14
Oil: Brent crude = US$48.73 a barrel, up 73 cents
Headlines
Trump win ‘will knock trillions off share prices’ – The Times
Sainsbury’s pension hole ‘exceeds £1 billion’ – The Times
UK female tech workers earn 9% less than men – The Financial Times
London & Country seeks investor ahead of £300 million float – The Daily Telegraph
Silverstone bidders reverse out of talks about buying the racetrack – The Daily Telegraph
Half of UK budget deficit 'is down to job destruction in older industrial areas' – The Guardian
Aviva Investors steps in to Openreach row calling for open discussions about BT's potential split – Daily Mail
Crestor competition expected to drag on AstraZeneca interim results – City AM