By Utkarsh Hathi
(Reuters) -UK stocks jumped 1% on Monday, echoing an upbeat mood across global markets on signs that a historic U.S. government shutdown could be nearing its end, while Diageo surged after it appointed a former Tesco boss as its CEO.
Diageo’s shares gained 7.2%, set for its biggest percentage gain in five years, after the world’s largest spirits maker appointed Dave Lewis as CEO.
“The stock is unloved after several years of disappointment and the appointment of a highly respected CEO could be enough to win over many investors,” said Dan Coatsworth, head of markets, AJ Bell. “However, Lewis knows he will ultimately be judged on results, not hope.”
Diageo’s shares were still hovering near decade-lows, having lost about 27% of their value this year.
The blue-chip FTSE 100 added 1% by 1158 GMT, while the mid-cap FTSE 250 index climbed 1.1%.
Global shares rallied after the U.S. Senate moved forward on a measure to reopen the federal government and end the shutdown.
UK stocks recorded a weekly loss on Friday after a selloff in high-flying U.S. tech stocks rippled through global markets and the Bank of England held interest rates as expected.
However, a narrow vote and signs that Governor Andrew Bailey might soon join those seeking a rate cut boosted prospect of a move in December once the government’s budget was unveiled.
Investors will keep an eye on third-quarter GDP data and more corporate earnings this week.
UK’s precious metal miners and industrial metal miners climbed 4.5% and 1.9%, respectively, as gold hit two-week high and copper prices climbed.
British Airways parent IAG gained 3.4%, having tumbled 11.6% on Friday after reporting weak U.S. demand.
London-listed shares of RHI Magnesita jumped 20% after the refractory products supplier reported robust profit margins and reaffirmed its full-year forecast.
(Reporting by Utkarsh Tushar Hathi in Bengaluru; Editing by Harikrishnan Nair)
