UK equites opened slightly higher on Monday morning, following a recent strong run and as traders awaited key economic data from the US later this week.
London's FTSE 100 opened just a few points higher than Friday's close of 6,622.59, though this was still the highest finish for the benchmark index since mid-September.
Financial Trader Shavaz Dhalla from Spreadex said that investors are now putting the concerns over the US budget behind them following last week's short-term agreement to raise the debt ceiling.
"Furthermore, since this matter has been put to bed for now, traders will be hoping that volumes will slowly return to normality as many have argued that the thin volumes as of late have largely been attributed to uncertainties in the US," he said.
Both the S&P 500
in the US and DAX 30 in Germany closed at all-time highs on Friday, while Australia's S&P/ASX 200 reached fresh five-year highs overnight, as analysts predicted that the prolonged government shutdown in America would delay plans by the Federal Reserve to taper its quantitative easing programme.
Markets will now be looking ahead to the delayed release of the September US employment report on Tuesday, which may be a big factor in the Fed's next move. Consensus forecasts are pointing to a 180,000 increase in US non-farm payrolls last month, higher than the 169,000 gain seen in August. However, the unemployment rate is expected to have remained unchanged at 7.3%.
As for today, US existing home sales data is the only notable economic release due out and is expected to show a fall of 3.3% month-on-month in September, reversing sharply after the previous 1.7% increase.
Defence stocks provide a lift
Stocks exposed to the defence outsourcing markets were making gains this morning, including G4S, Babcock, BAE Systems and Smiths Group, as investors celebrated the end of the government shutdown in the US.
Aerospace and defence engineer Senior rose after saying strong order books at Airbus and Boeing had helped it keep profits on track since early July. The stock was also upgraded this morning by N+1 Singer to 'buy'.
Hedge fund manager Man Group was also higher after Exane BNP Paribas raised its rating for the shares
Banking and financials stocks were among the worst performers with RBS, Barclays, Prudential, Old Mutual and Legal & General trading in the red.
Meanwhile, miners including Vedanta, Antofagasta, Centamin and Polymetal edged higher as metal prices advanced.
FTSE 100 - Risers
G4S (GFS) 248.90p +2.85%
Babcock International Group (BAB) 1,233.00p +2.15%
BAE Systems (BA.) 452.90p +1.80%
Burberry Group (BRBY) 1,548.00p +1.38%
Vedanta Resources (VED) 1,053.00p +1.35%
Weir Group (WEIR) 2,323.00p +1.31%
Aggreko (AGK) 1,471.00p +1.17%
Amec (AMEC) 1,116.00p +1.09%
Smiths Group (SMIN) 1,416.00p +1.00%
Antofagasta (ANTO) 907.50p +0.95%
FTSE 100 - Fallers
Royal Bank of Scotland Group (RBS) 350.60p -5.93%
Barclays (BARC) 273.00p -1.75%
Kingfisher (KGF) 379.70p -1.43%
Morrison (Wm) Supermarkets (MRW) 279.10p -1.20%
SABMiller (SAB) 3,122.00p -1.14%
Marks & Spencer Group (MKS) 490.50p -0.93%
Prudential (PRU) 1,257.00p -0.55%
Shire Plc (SHP) 2,523.00p -0.55%
Old Mutual (OML) 199.40p -0.55%
Legal & General Group (LGEN) 206.20p -0.53%
FTSE 250 - Risers
Centamin (DI) (CEY) 52.70p +2.93%
QinetiQ Group (QQ.) 198.90p +2.58%
Morgan Advance Materials (MGAM) 306.50p +2.27%
UDG Healthcare Public Limited Company (UDG) 325.00p +2.20%
Go-Ahead Group (GOG) 1,704.00p +2.16%
Regus (RGU) 217.00p +2.12%
Howden Joinery Group (HWDN) 327.90p +2.09%
Polymetal International (POLY) 613.50p +2.08%
Daejan Holdings (DJAN) 4,008.00p +1.96%
Crest Nicholson Holdings (CRST) 371.90p +1.89%
FTSE 250 - Fallers
Betfair Group (BET) 1,006.00p -1.85%
IP Group (IPO) 135.00p -1.68%
Perform Group (PER) 549.00p -1.61%
Alent (ALNT) 350.80p -1.32%
Wetherspoon (J.D.) (JDW) 745.00p -1.13%
AL Noor Hospitals Group (ANH) 830.50p -1.07%
Dialight (DIA) 1,195.00p -0.99%
Cranswick (CWK) 1,078.00p -0.92%
Bank of Georgia Holdings (BGEO) 1,981.00p -0.90%
Domino's Pizza Group (DOM) 607.50p -0.65%