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FTSE 100 Rallies On Recovery Optimism

U.K. stocks were sharply higher on Monday as investors cheered a strong rally in Chinese markets on expectations the world's second biggest economy will lead a recovery from the coronavirus-induced slump.

China's Shanghai Composite Index jumped as much as 5.71 percent, marking the biggest advance since 2015.

Also helping underpin investor sentiment, a survey showed the U.K. construction industry surged back to growth in June.

The closely followed IHS Markit/CIPS construction purchasing managers' index (PMI) surged to a reading of 55.3 last month, from 28.9 in May.

The pound fell against the euro and held steady against the U.S. dollar as investors looked ahead to Chancellor Rishi Sunak's mini-Budget on Wednesday and a meeting of Eurozone finance ministers on Thursday for further direction.

The benchmark FTSE 100 was up 118 points, or 1.91 percent, at 6,275 after losing 1.3 percent on Friday.

Energy stocks were gaining ground, with BP Plc climbing 2.3 percent and Royal Dutch Shell adding 2.1 percent.

Housebuilder Persimmon surged 6.6 percent, Taylor Wimpey jumped 5.9 percent and Barratt Developments added 8.4 percent on reports that British Finance Minister Rishi Sunak plans to raise a property tax threshold.

Aviva soared 4.2 percent as it announced the appointment of Amanda Blanc as Chief Executive Officer with immediate effect.

Lloyds Banking Group rose 1.6 percent. Robin Budenberg CBE has been selected to succeed Lord Blackwell as Chairman.

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