By Patrick Munnelly, Market Strategist, Tickmill
UK stocks saw gains on Thursday, aligning with a positive trend in Asian markets.
The FTSE 100, known for its significant exposure to exporters, saw an increase in its value, closing the day up 0.32%.
Positive market sentiment
Several key factors contributed to the positive market sentiment.
Firstly, the market responded positively to a pullback in the U.S. Treasury yields, driven by more dovish statements from Federal Reserve officials. This shift in expectations regarding U.S. interest rates had a buoyant effect on investor confidence.
Additionally, the anticipation of new stimulus measures in China provided further impetus to the positive sentiment.
Chinese stocks received a boost following news that a state fund had increased its holdings in the country’s major banks.
A weaker British pound also supported the FTSE 100, which is often favoured by exporters. Economic data indicated that the UK economy had grown as expected in August, although there had been a more substantial contraction in July than initially estimated.
BP at the top of the FTSE 100 leaderboard
Notably, BP LON:BP. was a standout performer, sitting at top of the blue-chip index, with its shares rising by 3%. This followed a two-day investor meeting in which BP reaffirmed its industry-leading commitment to reducing oil and gas production.
The company’s new management assured investors that the resignation of Chief Executive Bernard Looney would not hinder its strategic goals.
Interim CEO Murray Auchincloss emphasised that BP’s strategy, financial framework, and net-zero ambitions remained unchanged.
The company’s focus remained on delivering its strategy safely and with discipline, quarter by quarter, to meet its 2025 targets and 2030 objectives.
Taylor Wimpey goes ex-dividend
On the negative side of the ledger sits Taylor Wimpey which saw a decline of 4.9% on the trading session, placing them at the bottom of the FTSE 100.
This decrease was due to the fact that the stock was trading today without entitlement to the dividend.
When a company trades without entitlement to a dividend, it means that shareholders who buy the stock on or after the ex-dividend date will not be eligible to receive the upcoming dividend payment.
This can lead to a drop in the stock’s price as investors who were primarily interested in the dividend may sell their shares, impacting the stock’s performance on that particular trading day.
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