FTSE 100 climbs higher as China manufacturing PMI offsets US-China trade war doubts
Strong Chinese manufacturing PMI pushed the FTSE 100 higher today despite a lack of progress between the US and China on a trade deal.
London’s blue-chip index rose to 7,395.5 points in early trading, up 0.67 per cent.
Read more: Asian stocks climb as Chinese manufacturing PMI improves
France’s Cac climbed 0.65 per cent to 5,943 points while Germany’s Dax also rose 0.68 per cent to 13,324 on the positive factory numbers coming out of China.
Factory activity expanded at its quickest pace in almost three years, according to Caixin/IHS Markit’s Purchasing Managers’ Index.
It hit a measure of 51.8 in November, up from 51.7 in the previous month. Anythign above 50 represents growth.
“A marginally better than forecast Chinese manufacturing PMI set the European markets up for a solid start to December,” Connor Campbell, financial analyst at Spreadex, said.
The stronger economic data lifted traders’ sentiment despite Germany factory figures showing it is stuck firmly in contraction territory.
The rise also overcame an Axios report citing a source close to Trump’s trade deal negotiating team stating that a so-called phase one trade deal between the superpowers had “stalled”.
An agreement will not be reached until the end of 2019 at the very earliest, the report added.
It was originally meant to have been signed off by US President Donald Trump and Chinese President Xi Jinping in mid-November.
“The FTSE 100 started December on the front foot, raising hopes that there could be a so-called ‘Santa Rally’ in stocks to round off the year,” AJ Bell investment director Russ Mould said.
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However, he added that the “still uncertain” outcome of the 12 December General Election could scupper any hopes for the FTSE 100 to climb further before Christmas.
“While the FTSE 100 looks on course to finish materially higher for the year, barring anything dramatic, it is being left in the shade by US indices which are marking new record highs,” Mould added.