MARKET CLOSE: Rate rise talk cools pushing up FTSE

The London Stock Exchange building. Picture: Getty

The benchmark FTSE 100 gained 128.31 points or almost 2 per cent to close at 6,961.77, with traders having the first opportunity to react to lacklustre jobs data in America last Friday suggesting the Federal Reserve will have more time before it needs to hike borrowing costs.

Jasper Lawler, market analyst at CMC Markets, said: “European stocks shot higher after the four-day weekend, playing catch-up with US markets. Estimates for the timing of the first US rate hike have been pared back after the disappointing non-farm payrolls report over Easter.

“The jump in Europe was bolstered by M&A amongst parcel delivery giants FedEx and TNT. It could be the beginning of a year-long trend of US companies putting their strong dollars to work in Europe.”

Among London’s blue-chip risers was Royal Mail, which climbed 5.6p to 448p after further consolidation in the parcels sector saw TNT Express agree to a £3.2 billion takeover by FedEx.

A buoyant session saw just three stocks end the day in the red, led by British Airways owner International Airlines Group. It finished 7p off at 591.5p as investors factored in the impact of the rising oil price.

But EasyJet managed to climb despite this as Dublin-based rival Ryanair said it grew customer numbers by 28 per cent in March. Easyjet added 2p to 1,846p while Ryanair rose nearly 2 per cent.

Meanwhile, regional carrier Flybe made gains after a reassuring trading update including an upbeat assessment on demand for summer flights.

The Exeter-based group said it would break even in the year just ended, a performance in line with the company’s profit warning in January. Shares were 0.2p higher at 57.8p.