FTSE 100 hits fresh four-month high on US-China trade talk optimism and European banking boost

The FTSE 100 ended a good week in strong fashion as optimism over the US-China trade dispute and the possibility of fresh stimulus measures for Eurozone banks boosted markets.

The UK’s blue chip index rose to a fresh four-month high and closed 0.6 per cent up for the day at 7,237 points.

European markets also rose as European Central Bank member Benoit Coeure floated the possibility of a new round of multi-year cheap loans to Eurozone banks.

But the FTSE 100 was held back in comparison to European markets due to the pound’s rally off the back off better-than-expected retail sales.

Sterling gained 0.34 per cent against the dollar, rising to $1.2846, therefore restricting the ground made by the largely internationally-exposed FTSE 100.

Turnaround specialist Melrose Industries led the biggest risers, climbing 5.6 per cent following a number of positive analyst notes.

Soft drinks bottler Coca-Cola HBC jumped 4 per cent, after it reported a rise in appetite for sparkling drinks in its results on Thursday, followed by Tesco, steel and mining firm Evraz, and Royal Bank of Scotland, which doubled profits and boosted its dividend with its results this morning.

The fallers were led by Standard Life Aberdeen, which slumped 6 per cent after a share offering was priced at a discount, followed by home improvement retailer Kingfisher and Next.

Friday’s trading capped off a strong week for the FTSE 100.

The index rallied at the beginning of the week as traders were optimistic over the latest round of US-China trade talks as a US delegation prepared to fly to Beijing.

It lost some of that momentum as the week moved on as consumer and industrial stocks weighed the FTSE down but positive murmurings from China kept it in positive territory.

Reports also emerged that US President Donald Trump was willing to push back his deadline for higher tariffs on Chinese imports by 60 days.

Valentine’s Day injected renewed vigour into the index, as pharmaceutical companies – led by AstraZeneca’s results – drove it upwards.

Despite the trade talks ending today with no official statement from either side, global markets, including the FTSE 100 ended the week strongly with investors still buoyed by the hope of a resolution to the dispute.