The UK’s FTSE 100 moved higher on Monday amid a boost from banks but was outperformed by European peers.
London’s top index was up 52.8 points, or 0.65%, to close at 8,125.19.
Banking groups NatWest, Barclays and Lloyds were among the biggest risers of the day, after NatWest said it had bought back £1 billion worth of Government-owned shares.
It takes the Government’s shareholding down to just over 11% as the lender moves closer towards full privatisation.
Chris Beauchamp, chief market analyst for trading platform IG, said: “After a miserable end to last week, the FTSE 100 has managed to rediscover some momentum, rallying 1% thanks to a strong showing from the UK banking sector.
“The UK Government’s sale of more of its stake is another vote of confidence in NatWest, another step in the long road away from 2008’s emergency government takeover.”
It was an even stronger day of trading for other top markets in Europe. In Paris, the Cac 40 climbed 1.2%, and in Frankfurt, the Dax closed 1.21% higher.
Over in New York, the S&P 500 was up about 0.3% and the Dow Jones was 0.8% higher by the time European markets closed.
Mr Beauchamp said a rally for New York’s top indices continued following last week’s US presidential election.
“The prospect of a Republican clean sweep continues to energise investors, and with earnings growth still healthy investors are also looking forward to a fresh burst of M&A (mergers and acquisitions) and IPOs (initial public offerings) that will provide fresh flows to US markets,” he said.
The price of Brent crude oil tumbled about 2.9% to about 71.75 US dollars per barrel on Monday.
The pound was down around 0.3% at 1.287 US dollars, and up 0.2% against the euro at 1.208.
In other company news, shares in Direct Line dipped after the insurer revealed plans to cut around 550 jobs as it seeks to save £50 million in 2025.
A trading update from the group said it lost more motor insurance customers over the third quarter, with policyholders for its own-brand cover down 11% year on year at 3.05 million.
The group said cost-cutting comes as part of a drive to become a leaner and more efficient organisation. Its share price closed 2.8% lower.
Chemicals company Croda International was the top riser on the FTSE 100 after reporting an 8% increase in sales for its third quarter, at constant currency, to £407 million.
The Yorkshire-based company said it was benefiting from “more stable customer inventories” and demand in its key markets, but flagged that conditions remain “challenging”. Shares in Croda rose 5.2%.
The biggest risers on the FTSE 100 were Croda, up 189p to 3,793p, Natwest Group, up 14.2p to 395p, Barclays, up 9.15p to 260.65p, Rolls-Royce, up 18.8p to 572p, and Sage Group, up 33.5p to 1,075p.
The biggest fallers on the FTSE 100 were Endeavour Mining, down 98p to 1,571p, Fresnillo, down 24p to 676p, Sainsbury’s, down 5.8p to 243.4p, Rio Tinto, down 96p to 4,850p, and Antofagasta, down 32.5p to 1,656.5p.