European equity markets remained closed today for the Labour Day holiday. The London equity benchmark index posted modest gains and ended 0.43% higher, while the US equity markets edged higher after mixed US employment data.
In corporate news, Pfizer reported that it plans to raise its bid for AstraZeneca to $106 billion. The UK’s pharmaceutical stocks continued its strong upside rally, with AstraZeneca and Shire gaining 3.24% and 2.13%, respectively.
UK banks also surged higher as risk appetite increased. Lloyds and HSBC climbed by 5.5% and 2.6%, respectively, while insurance and real estate companies also posted modest gains following a further increase in the UK housing prices. The UK Nationwide house price survey showed prices surged by 10.9% y/y in April, beating analysts’ expectations.
Crude oil prices extended losses today, with Brent front month futures trading around $107.50 per barrel, as modest Chinese PMI economic data weighed on market sentiment, verifying concerns about a slowdown in the oil demand from Asia. Royal Dutch Shell and BP declined by 0.6% and 0.23%, respectively.
In metals, the LME aluminium 3M contract retreated by 0.78%, trading around 1785, while copper consolidated near 6640, struggling for direction.
Tomorrow, all eyes remain on the release of the key US non-farm payrolls data, which could provide an outlook about the US employment conditions and market expectations in the short-term. Furthermore, following the FOMC announcement yesterday, the US Fed will keep reducing its QE programme in the few months, with a plan to end stimulus by the end of 2014.