London stocks climb on hopes of Russia-Ukraine peace deal
As of 10:30 a.m. GMT, the blue-chip FTSE 100 (.FTSE), opens new tab gained 0.2% and the midcap index FTSE 250 (.FTMC), opens new tab rose 0.4%.
Market sentiment improved on hopes that peace in Ukraine might be achievable after Trump met with President Volodymyr Zelenskiy and European allies on Monday. He pledged that the U.S. would help guarantee Ukraine's security in any deal ending Russia's war there.
Zelenskiy described this commitment as "a major step forward" and noted that Kyiv offered to purchase about $90 billion worth of U.S. weapons.
The peace prospects sent the aerospace and defence sector (.FTNMX502010), opens new tab down 2.4%.
Financials drove the gains on the FTSE 100, with the banking index (.FTNMX301010), opens new tab rising 0.8%. Lender Metro Bank (MTRO.L), opens new tab advanced 4% after RBC Capital Markets upgraded the stock to "outperform" from "sector perform".
"Banks are potentially benefiting from the fact that the Bank of England may be slower in cutting rates than initially expected," said Fiona Cincotta, senior market analyst at City Index.
Money markets are not fully pricing in another BoE interest rate cut until February next year, reflecting the cautious tone struck by policymakers at their last meeting.
On the flip side, the energy index (.FTNMX601010), opens new tab rose 0.5%, despite a fall in oil prices on the possibility that a peace deal with Moscow could lead to the lifting of sanctions on Russian crude, raising supply.
The week features key UK economic indicators, with inflation, PMI and retail sales data on the radar. Investors are particularly focused on Wednesday's inflation figures to gauge the central bank's monetary policy path.
Industrial metal mining companies (.FTNMX551020), opens new tab also contributed to the gains, rising 1.9%.
Among stocks, International Workplace Group (IWG.L), opens new tab fell 17.9%, heading for its worst single-day drop since March 2020, after the office rental company indicated annual adjusted core profit would likely be towards the lower end of its forecast.
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