London stocks rise on recovery, Brexit hopes

London-listed shares traded higher on Wednesday on hopes that massive global rollouts of COVID-19 vaccines would help put the economy back on its feet next year, while investors also held out hope for a Brexit trade deal.

The blue-chip FTSE 100 index jumped 1.1pc, led by energy, financial and mining stocks, with the MSCI world index tracking overnight gains on Wall Street.

The domestically focussed FTSE 250 index gained 1.2pc and was on course to rise for a third straight session as the European Union's chief executive said there had been progress in Brexit talks and that the next few days would be critical.

"Investors seem to think a Brexit deal is in the offing," AJ Bell investment director Russ Mould said, adding that markets were also cheering signs of progress in another round of U.S. fiscal stimulus.

"Tangible progress on either of these fronts could help put markets on the front foot in the final trading days of 2020."

A slew of stimulus measures coupled with vaccine optimism has helped London's stock indexes recover from multi-year lows hit in March, but recent gains have been capped by fears around the near-term economic damage from coronavirus-linked shutdowns in business activity.

Data on Wednesday showed the economy limped back to growth in December following November's four-week lockdown in England, although hospitality businesses still struggled with restrictions.

In company news, electricals retailer Dixons Carphone surged 13.0pc to its highest in nearly 10 months after posting a big rise in first-half profit.

"Dixons' sales of electricals have been so strong that, for once, it doesn't really matter that its mobile phone business continues to be horrific," Mould said.

Fashion retailer Superdry jumped 6.7pc as it said interim Chief Executive Officer Julian Dunkerton would take the top job on a permanent basis.