City rejoices early as Britain heads to polling booths

Another swing in opinion polls back towards Remaining in the EU has sparked a six-month high for the British pound and a surge in UK and European stocks. Investors who wanted to protect their portfolio against adverse moves in Sterling or other UK assets will have done so already. With a slight bias to a Remain vote, there is no need for any additional hedging trades and the lighter volume suggests day traders are sitting on their hands until the result is out.

Another swing in opinion polls back towards Remaining in the EU has sparked a six-month high for the British pound and a surge in UK and European stocks. Investors who wanted to protect their portfolio against adverse moves in Sterling or other UK assets will have done so already. With a slight bias to a Remain vote, there is no need for any additional hedging trades and the lighter volume suggests day traders are sitting on their hands until the result is out.

The FTSE 100 gained over 1.5% in morning trade led by an advance in Tesco shares after it reported a second quarter of rising UK sales and the sale of the Harris and Hoole coffee chain. The rise in UK sales is especially encouraging for a quarter in which Tesco heavily slashed prices. The results show customers are coming back to shop at Tesco, evidence that CEO Dave Lewis’ restructuring plan is taking shape.

Brexit-sensitive bank and homebuilder shares are amongst the top risers with heavily weighted mining shares also higher amid improved investor sentiment.

US stocks look set for a stronger open, bolstered by signs that the UK will vote to remain in the EU.

USA pre-opening levels

S&P 500: 21 points higher at 2,106

Dow Jones: 180 points higher at 17,960

Nasdaq 100: 48 points higher at 4,452

 

 

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