UK stocks start the week higher as banks, AstraZeneca climb

LONDON: UK equities surged on Monday, as bank stocks rebounded on hopes that the turmoil in the sector will be contained following the buyout of Silicon Valley Bank, while AstraZeneca rose after it gave a positive update on a drug trial.

Banks rose 0.8%, after tanking 3% in the previous session, after U.S. lender First Citizens BancShares Inc said it would purchase the loans and deposits of failed Silicon Valley Bank, easing investor angst about the global financial system. The blue-chip FTSE 100 was up 0.6%, while the domestically-oriented FTSE 250 added 0.4% by 0835 GMT.

"Any positive banking news will boost sentiment because markets are hypersensitive to any banking news at the moment. But my best reading of it is that sentiment is fragile and cautiously optimistic today due to those lingering banking fears," said Giles Coghlan, chief market analyst at HYCM. Both the FTSE indexes ended the first two months of the year with gains as hopes of a rebound in demand following a reopening of the Chinese economy and signs of stability in the domestic economy boosted sentiment.

However, Silicon Valley Bank's collapse in the middle of this month sparked a crisis of confidence in the stability of the global financial system and a selloff in markets. The FTSE indexes are on course for losses for March. AstraZeneca Plc rose 1.3% on the day and boosted the healthcare sector after reporting that its drug Eplontersen showed positive results in a late-stage trial among hereditary transthyretin patients.

Activist investor Elliott Management is planning a takeover of Cineworld Group's operations in eastern Europe and Israel as per a report over the weekend, sending shares of the cinema operator 10.6% up. Nanoco Group slid 1.5% after a shareholder group asked two top bosses at the quantum technology company to step down on allegations of misleading information about losses related to the prospect of settling a lawsuit with Samsung Electronics.