London Stocks Climb as Trade Tensions Ease

London shares moved higher on Thursday as improved global sentiment lifted investor confidence, following signs that trade tensions linked to Greenland would ease. Major UK indices advanced in a broad based rally, with gains spread across financials, real estate, and construction stocks. The FTSE 100 rose steadily, recovering much of its earlier weekly losses, while the more domestically focused FTSE 250 outperformed as appetite for risk returned. Markets reacted positively after US President Donald Trump stepped back from tariff threats tied to Greenland, calming fears of an escalating trade dispute between the United States and parts of Europe. The shift helped stabilise sentiment across London, where traders had been cautious earlier in the week amid renewed concerns about protectionism and geopolitical uncertainty affecting international trade flows.

Financial stocks were among the strongest performers, providing a significant boost to the main index as major lenders recorded solid gains. Real estate and construction shares also advanced, reflecting optimism tied to lower trade risk and hopes for steadier economic conditions. Technology and engineering firms saw notable moves after issuing upbeat profit outlooks, reinforcing confidence as the earnings season gathered momentum. Investors appeared encouraged by company specific updates suggesting resilient demand despite broader global uncertainty. Some retail stocks recovered from early losses after issuing cautious trading statements, while energy shares lagged the wider market as falling oil prices weighed on the sector. Overall, the rally reflected a shift toward risk assets, with market participants rotating back into equities after recent volatility unsettled sentiment across European markets.

Attention now turns to upcoming economic data releases from the United States, including consumer spending and growth figures, which investors will closely watch for clues on the future direction of interest rates. Expectations around monetary policy remain a key driver for global markets, influencing currency movements and equity valuations alike. In the UK, fresh data showing lower than expected government borrowing in December provided some domestic reassurance, potentially easing pressure on fiscal policy as the new year unfolds. Analysts said the combination of easing trade fears, supportive earnings updates, and stable economic signals helped underpin the day’s gains. While uncertainties remain around geopolitics and global growth, Thursday’s session offered a reminder of how quickly sentiment can shift when policy risks recede, allowing London markets to regain ground and start rebuilding confidence after a turbulent start to the week.