London markets open up 2.7% by 151 to 5,779 points as Donald Trump rolls out plans to gradually re-open the US economy and coronavirus drug trial shows promising early signs
- The rise in the markets was fuelled by Donald Trump’s plans to end US lockdown
- Also rose due to drug trial with promising results for severe coronavirus patients
- Similar promising gains were seen across European and Asian markets on Friday
- Learn more about how to help people impacted by COVID
Britain’s stock markets jumped by 2.7 per cent on Friday as investors cheered Donald Trump’s plans for the gradual restarting of the U.S. economy and encouraging data on possible treatment for coronavirus.
The surge was led by world’s top iron ore miner Rio Tinto Ltd, which jumped 4.5%, after posting higher-than-expected quarterly production.
The wider mining index gained 4.1%, with peers Anglo American and Glencore adding more than 4.5%.
The domestically-focused midcap index rose 3.2%.
However, despite the promising news, both indexes are on track to post weekly losses after the UK extended its lockdown for another three weeks to prevent the spread of the pandemic, which has claimed 13,729 lives as of Wednesday.
Today: The FTSE100 rose sharply this morning, after Donald Trump rolled out a provisional plan to get the US out of lockdown
Weekly: Despite the promising news, both indexes are on track to post weekly losses after the UK extended its lockdown for another three weeks
The surge appeared to be part-fueled by news that US drugmaker Gilead Science’s antiviral medicine showed rapid recoveries in severe coronavirus patients with fever and respiratory symptoms.
Also, the United States joined other countries in planning lockdown exit measures with a staggered, three-stage approach following weeks-long lockdown that has disrupted economic activity.
Donald Trump’s approach signalled a general idea of how and when states would get to a point where their citizens could congregate, work, get educated, and dine in public – though the reopening of states would be left to individual governors.
‘Stocks are reacting naturally to Trump’s talk of re-opening the economy, because some people don’t want to be left out of the rally,’ said Ayako Sera, market strategist at Sumitomo Mitsui Trust Bank in Tokyo.
‘The problem is there is a big gap between expectations and the underlying economic reality, which is that many countries are still very weak.’
South Korean dealers work in front of monitors at the Hana Bank in Seoul. Markets in Asia and Europe also rose today
Primark owner Associated British Foods also rose 4.8% after saying it is eligible to access funding under the UK government’s Covid Corporate Financing Facility to help it through the coronavirus crisis.
Europe’s stock markets also rallied in opening deals today, after news that China’s economy has not been hit as badly as feared by the outbreak.
In the eurozone, Frankfurt’s DAX soared 2.9 percent to 10,596.28 points and the Paris CAC 40 rebounded 2.6 percent to 4,464.21.
Milan’s FTSE Mib advanced 2.4 percent to 17,167.43 and Madrid’s IBEX 35 won 2.3 percent to 6,918.60 points.
Asia indices also posted healthy gains after official data in China showed the coronavirus pandemic had not hit economic growth as badly as some had feared.
Official data showed a 6.8-percent contraction last quarter — the first negative growth reported since the country began logging quarterly data in the early 1990s.
The result was slightly better than the 8.2-percent fall forecast by economists in an AFP poll, though analysts in China and abroad have long harboured doubts about the accuracy of official GDP data.