London's FTSE 100 hit an over two-month high in a broad-based rally on Thursday as a softer-than-expected U.S. jobs report calmed jitters about potential interest rate hikes by the Federal Reserve.
The blue-chip FTSE 100 index CURRENCYCOM:UK100 rose 1.7% to 10,652.9 points at the close, its highest since late-April. The midcap FTSE 250 FTSE:MCX also gained 0.4%, hitting a two-week peak.
The healthcare sub-index (.FTNMX201030) rose 4.4%, boosted by AstraZeneca LSE:AZN, which gained 4.9% after striking a deal worth up to $1.77 billion with China's CSPC Pharmaceutical Group HKEX:1093 to develop treatments for kidney ailments.
Consumer-focused stocks Tesco LSE:TSCO, Coca-Cola HBC LSE:CCH and J Sainsbury LSE:SBRY rose between 2% and 3.7%.
Defence stocks also rallied, with BAE Systems LSE:BA., Rolls-Royce LSE:RR., QinetiQ Group LSE:QQ., Babcock LSE:BAB, and Chemring LSE:CHG up between 1% and 7.1%.
U.S. job growth slowed more than expected in June and payroll gains for the prior two months were revised lower, pointing to a cooling labour market.
Bets of at least one rate hike by the Fed this year lowered to 76%, according to data compiled by LSEG, from around 84% before the employment report.
Precious metal miners FTSE:NMX551030 advanced 3.3% as gold prices rallied over 2% against a weaker dollar.
On the geopolitical front, Iran and the United States concluded a round of indirect talks with no sign they had made headway toward lasting peace.
Meanwhile, British business confidence fell to its lowest since 2022 as the Iran war, a survey of accountants showed.
Among individual UK stocks, British electricals retailer Currys LSE:CURY fell 1.4% after it warned that a global memory chip shortage could drive up prices for smartphones, laptops and other electronics later this year.
Capricorn Energy LSE:CNE surged 19.8% after Kurdistan-focused oil and gas producer Genel Energy LSE:GENL agreed to acquire the company in a $360 million all-cash deal. Genel rose 7%.