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UPDATE 2-London stocks end at multi-month highs on vaccine optimism, commodity gains

25 Nov 2020 / 01:12 H.

    * Travel stocks jump on ease in quarantine period

    * Commodity stocks boosted by strong oil, metal prices

    * AO World slumps on anticipation of Brexit disruptions (Updates to close)

    By Devik Jain and Ambar Warrick

    Nov 24 (Reuters) - Heavyweight commodity stocks pushed London's blue-chip index to a more than five-month closing high on Tuesday, while the midcap index ended at a near nine-month peak as optimism over a coronavirus vaccine increased hopes for a swift economic recovery.

    The commodity-heavy FTSE 100 index ended 1.6% higher, with energy and mining heavyweights BP and Rio Tinto supporting the index on the back of strong oil and base metal prices.

    The domestically focused mid-cap FTSE 250 index added 1.1%, ending at its highest level since early-March with industrial stocks serving as the biggest boost.

    Both indexes surged in late trade, tracking gains on Wall Street after the formal go-ahead for President-elect Joe Biden's transition to the White House ended weeks of political uncertainty in Washington.

    Travel stocks rallied after England said it would introduce a new COVID-19 "test-and-release" scheme on Dec. 15 to reduce quarantine periods for incoming passengers from high-risk countries.

    "Investors are still thinking long-term post-vaccine at the moment and are looking into various sectors that have been haemorrhaged in the last eight months," said Connor Campbell, financial analyst at Spreadex.

    A sharp rally in cyclicals such as energy and bank stocks on vaccine-related cheer and hopes of a speedy economic recovery have helped the FTSE 100 index gain more than 14% this month, setting it on track for its best month on record.

    Among individual movers, Catering firm Compass Group Plc rose 2.5% even as it reported a 75.5% slump in annual pretax profit.

    Online electricals retailer AO World sank nearly 10% after it said it doubled its warehouse capacity to cope with any possible supply disruptions caused by Brexit. (Reporting by Devik Jain in Bengaluru; Editing by Uttaresh.V and Alex Richardson)

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