Russia relief helps UK FTSE snap losing steakComment on this story
London - British shares snapped a three-day losing streak on Monday as traders saw Russia's decision to pull back troops from near the Ukrainian border as a sign of easing tensions between Moscow and Kiev.
Late on Friday, Moscow's Defence Ministry said it had ended military exercises in southern Russia, which the United States had criticised as a “provocative” step amid the Ukraine crisis.
Talk of a ceasefire in Ukraine, however, evaporated as Kiev government forces kept up an offensive to crush pro-Russian rebels.
Fears that Russia could invade eastern Ukraine and tit-for-tat sanctions between Moscow and the European Union have knocked stock markets over the past month.
They compounded worries about conflicts in the Middle East, weak European economic data and the prospect of a tighter US monetary policy.
“It's very early to start celebrating and you've still got the negative effects of the sanctions, which are likely to filter through over the coming months,” Michael Hewson chief market analyst at CMC Markets UK, said.
“But anything that ratchets down the tension is always going to be an opportunity to take profit on the shorts and maybe doing a little bit of bargain hunting.”
The FTSE 100 was up 36.76 points, or 0.6 percent, at 6,604.12 points, bouncing from oversold territory after a 3.3 percent fall over the previous two weeks.
The broader FTSE 350 index, which also includes small caps, was also up 0.6 percent after falling for three straight sessions.
Mid-cap chemical firm Synthomer was the top riser on the FTSE 350, up 5 percent, as it increased its interim dividend to 3 pence from 2.4 pence a year earlier.
“One positive in the announcement is confirmation of a more generous dividend policy,” analysts at N+1 Singer wrote in a note.
“A special (dividend) would also be considered if the Group ends up with surplus cash, which it is likely to given the current land disposal process in Malaysia.” - Reuters