The FTSE 100 edged upwards on Monday, notching another record close, ahead of a week dominated by central bank meetings and tech earnings.

The FTSE 100 index closed up 8.20 points, or 0.1%, at 9,653.82. It had earlier set a new intra-day high of 9,672.74.

The FTSE 250 ended 17.54 points lower, or 0.1%, at 22,511.48, and the AIM All-Share declined 4.66 points, 0.6%, at 772.60.

Markets were given a lift by productive trade talks between the world’s two largest economies, China and the US.

Joshua Mahony at Scope Markets said the weekend talks between US-Chinese negotiators appear to have resulted in a “significant breakthrough”, with US Treasury Secretary Scott Bessent announcing that a “substantial framework” had been agreed upon.

That framework covers a wide range of issues, including export controls, tariff suspensions, fentanyl-related tariffs, and agricultural trade.

“With the Trump-Xi meeting always likely to be a result of significant groundwork being made by their negotiating teams, there is an optimism that the two leaders can strike a more conciliatory tone than had been seen over recent weeks,” he added.

In Europe on Monday, the CAC 40 in Paris ended up 0.2%, while the DAX 40 in Frankfurt closed 0.3% higher.

Stocks in New York were higher at the time of the London close. The Dow Jones Industrial Average was up 0.5%, the S&P 500 was 1.0% higher, and the Nasdaq Composite advanced 1.6%.

The yield on the US 10-year Treasury was quoted at 4.02%, stretched from 4.00% on Friday. The yield on the US 30-year Treasury stood at 4.59%, widened from 4.58% on Friday.

On Wall Street, the focus this week is on Wednesday’s interest rate decision and earnings from five of the ‘Magnificent 7’ with Amazon, Alphabet, Apple, Meta Platforms and Microsoft, which hit the wires after the market close on Wednesday and Thursday.

The Federal Reserve is widely expected to lower interest rates on Wednesday and possibly tee up another quarter-point reduction in December, despite a lack of data because of the federal government shutdown.

Morgan Stanley said: “Limited data availability should not stop the Fed from reducing its policy rate again in October and signalling another cut is likely in December, but it could limit how far rate guidance extends past year-end.”

After a 25 basis points cut on Wednesday, the investment bank expects further cuts in December, January, April and July, with a terminal rate of 2.75%-3.00%.

The pound was quoted higher at 1.3331 dollars at the time of the London equity market close on Monday, compared with 1.3301 dollars on Friday.

The euro stood at 1.1639 dollars, up compared with 1.1631dollars. Against the yen, the dollar was trading at 153.04 yen, higher compared with 152.79 yen.

On the FTSE 100, HSBC fell 0.3% as it said it will set aside 1.1 billion dollars (£0.82 billion) after an adverse court ruling related to the Bernard Madoff investment fraud.

The provision will be included in its third-quarter results, due for release on Tuesday.

Madoff, who died in a North Carolina prison in 2021, admitted to defrauding thousands of investors of around 65 billion dollars (£48.7 billion) through a Ponzi scheme.

“This is not a great headline and was unexpected, but the overall financial impact is not material to the investment case,” commented Shore Capital banking analyst Gary Greenwood.

But other banking stocks pushed higher, with Standard Chartered up 3.2%, Lloyds Banking up 2.3%, and NatWest and Barclays both 1.9% to the good.

Analysts at JP Morgan (JPM) think that the consistency of earnings generation and strong capital in UK domestic banks remains “underappreciated” with valuations below European peers.

“Concerns around an inflection in hedge earnings are premature, in our view, while we also see a ‘reasonable’ tax increase with the Budget as largely priced, allowing investors to re-engage with the sector,” JPM added, noting the outlook for distributions is “solid”.

But Centrica fell 1.4%, as Citi downgraded the British Gas owner to ‘hold’ from ‘buy’.

“With the stock now within touching distance to our unchanged 185p price target, with no immediate upside catalyst, some concerns gathering around UK politics and Centrica Energy for the (full year), as well as our more cautious view of commodity outlook, we struggle to see much absolute upside,” analyst Jenny Ping wrote in a research note.

The more ‘risk-on’ mood saw the safe haven of gold retreat, dragging Fresnillo and Endeavour Mining both down by 5.0%. On the FTSE 250, Hochschild Mining fell 5.2%.

Gold traded at 3,993.32 dollars an ounce on Monday, down from 4,125.47 dollars on Friday.

James Luke, senior portfolio manager, gold and commodities at Schroders said it was a “natural correction within a multi-year bull market”.

“We continue to view this bull market as incomparable with prior bull markets in terms of the breadth and depth of potential monetary demand. If, as we see it, this is the ‘Mount Everest’ of gold bull markets, while we are well into the foothills, there is a long climb yet to reach the peak,” he added.

Back on the FTSE 250, Goodwin stormed 33% higher after announcing a special dividend and stating it expects its annual profit to double.

The Stoke-on-Trent, Staffordshire-based engineering and manufacturing company said that for the financial year to April 30, it expects to report pre-tax trading profit of £71 million, doubling from £35.5 million the year prior.

The special dividend, totalling 532 pence per share, was to “acknowledge and reward shareholders for their long-term commitment”, Goodwin said.

Brent oil traded at 65.99 dollars a barrel on Monday, down from 66.56 dollars late on Friday.

The biggest risers on the FTSE 100 were Standard Chartered, up 45.5 pence at 1,470.5p, Polar Capital Technology Trust, up 10.5p at 460.5p, Lloyds Banking Group, up 1.98p at 87.84p, St James’s Place, up 30.0p at 1,369.0p and Burberry, up 29.0p at 1,325.5p.

The biggest fallers on the FTSE 100 were Endeavour Mining, down 160.0p at 3,018.0p, Fresnillo, down 111.0p at 2,102.0p, Ashtead Group, down 134.0p at 5,178.0p, Croda International, down 67.0p at 2,943.0p and Entain, down 17.6p at 807.0p.

Tuesday’s global economic diary sees the start of the two-day Federal Open Market Committee meeting, plus house price data and the Conference Board consumer confidence report in the US.

Tuesday’s domestic UK corporate calendar has a trading statement from miner Anglo American and third-quarter earnings from Asia-focused lender HSBC.

Contributed by Alliance News