LONDON: London stocks jumped on Wednesday, logging nearly 8% gains this week, as optimism about an effective Covid-19 vaccine offset concerns over surging coronavirus cases and a deadlock in Brexit trade talks with the European Union.

The blue-chip FTSE 100 index closed up 1.4%, touching its highest level since June 10, with British Airways owner IAG rising 8% after Goldman Sachs upgraded the stock to ‘buy’.

A weaker sterling also boosted dollar earners such as AstraZeneca Plc, British American Tobacco Plc and Unilever Plc and HSBC Holdings Plc.

The domestically focused mid-cap FTSE 250 ended 1.6% higher, boosted by financial and real estate stocks.

“This week’s news on a vaccine, while welcome, does not change the fact that France, Germany and the UK are still in the middle of partial economic lockdowns,” Michael Hewson, chief market analyst at CMC Markets, wrote in a note.

After falling nearly 5% in October, the FTSE 100 is up more than 14% this month, outperforming its US and European peers as a slew of stimulus measures and positive vaccine data supported hopes of a sooner-than-expected economic recovery.

Workspace Group slipped 2.5%, after it swung to a first-half loss and deferred a decision on full-year dividend.

Online betting group Flutter Entertainment and defence company BAE Systems Plc jumped 5% and 2.5% respectively, after they raised their annual earnings forecast.—Reuters