Markets move higher amid trade optimism

The FTSE 100 surged higher on Wednesday amid renewed hopes that US-China trade talks will result in a positive outcome.

London’s premier index hit its highest level in four months, following US peers and closing the day up 57.7 points, or 0.81%, at 7,190.84.

“Stocks are higher this afternoon as traders are hopeful about the US-China trade talks that are taking place. US treasury secretary, Steve Mnuchin, said the talks were going well.

“President Trump will potentially ease up on the March deadline, and that is seen as a positive sign,” said David Madden, analyst at CMC Markets.

“Overall, we have heard very little about the discussions, but importantly, what we have heard has been positive so traders are happy to buy into the market.”

In stocks, Whitbread rose towards the top of the FTSE 100 after unveiling plans to return another £2 billion to investors following its £3.9 billion sale of Costa Coffee.

The Premier Inn owner also plans to slash costs by a further £220 million and potentially double the hotel chain’s size to more than 170,000 rooms, including at least 110,000 in the UK.

Whitbread shares were up 138p, or 2.9%, at 4,901p.

Dunelm’s stock was riding higher after the retailer reported a 24% increase in pre-tax profit for the six months ended December 29 to £70 million.

Sterling was trading 0.2% lower against the US dollar at the London market close at 1.285. Versus the euro, the pound was up 0.1% at 1.140.