European stocks raced ahead as investors priced in the prospect of Emmanuel Macron beating Marine Le Pen in the second round of voting in the French presidential election.
The FTSE 100 Index clawed back some of the losses triggered by last week’s announcement of a snap general election, closing up 150.13 points at 7,264.68 and adding more than £38 billion to the value of blue-chip companies.
However, Colin Cieszynski, chief market strategist at CMC Markets, remained cautious about pencilling in a victory for Macron.
He said: “Traders appear to have taken the results and polls to suggest the second round as a mere formality and anointed Macron the winner.
“Traders rushing to get back on the EU bandwagon, however, might want to recall that we saw a similar spike in UK markets a week before the Brexit vote last June as traders got over-confident that remain would win and we all saw how that ended.”
In UK stocks, heavyweight financial firms dominated the biggest risers as the French election cheer spread to the London market.
Barclays jumped more than 5 per cent or 11.3p to 219.2p, while Standard Chartered lifted by 32.6p to 718.5p and Royal Bank of Scotland rose 9.5p to 249.3p.
Energy stocks were among a small number of fallers, with investors reacting to news that the Tory manifesto will include a policy to cap energy bills.
British Gas owner Centrica was the biggest faller, down more than 3 per cent or 7.3p to 200.4p, and Perth-based SSE fell 28p to 1,417p.