FTSE 100 is trading up 1.15% at 6916.50
European stock markets edged higher Monday, with the U.K. outperforming, following the news that the new Chancellor will bring forward the announcement of his fiscal plans to shore up market confidence after weeks of turmoil.
By 03:40 ET (07:40 GMT), the DAX in Germany traded 0.1% higher, the CAC 40 in France rose 0.1%, and U.K.’s FTSE 100 climbed 0.3%.
New British finance minister Jeremy Hunt will announce tax and spending measures later Monday, two weeks earlier than previously scheduled, after the original economic plan put forward by Prime Minister Liz Truss and former Chancellor Kwasi Kwarteng roiled financial markets.
Sentiment has been boosted by weekend reports that the U.K. government is preparing to do a major U-turn on planned tax cuts, with yields on British government bonds sharply lower even without the support of the Bank of England’s emergency bond-buying program, which ended Friday.
That said, investors continue to fret about the deteriorating economic outlook, as well as a continuation of tightening monetary policies around the world.
Last week, a hotter-than-expected U.S. inflation reading largely cemented expectations for further Federal Reserve rate hikes this year, and third quarter GDP data from China, due on Tuesday, is expected to show the slowest annual rate of growth in nearly 50 years.
Back in Europe, the economic data slate is largely empty, but Italian consumer prices are expected to remain elevated in September, climbing 8.9% on the year.
This will add to the pressure on the European Central Bank to continue hiking interest rates. ECB policymakers Luis de Guindos and Philip Lane are set to speak at different events Monday, and their comments will be studied for clues of future moves.
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