London open: FTSE gains after Nikkei surge; NatWest slumps on acquisition

(Sharecast News) - London stocks rose in early trade on Monday as Japan's Nikkei surged nearly 4% after prime minister Takaichi secured a landslide victory in Sunday's general election. At 0830 GMT, the FTSE 100 was 0.4% higher at 10,407.66.

Derren Nathan, head of equity research at Hargreaves Lansdown, said: "The FTSE 100 shrugged off this weekend's political turmoil in Whitehall to open up near record highs, as it holds on to the coat tails of a strong Monday for Asian stocks. With precious metals gaining ground again expect a good start for the miners. After last week's see-saw, silver is up nearly 5% and gold has crept back over the $5,000/oz level as investors prepare for US inflation and jobs data later in the week.

"Japan's electorate braved blizzard conditions to give Prime Minister Sanae Takaichi's Liberal Democratic Party more than a two-thirds majority in the Land of the Rising Sun's powerful lower chamber. Her spend big and tax low approach has gone down well with stock markets, with the Nikkei crossing the 57,000 barrier for the first time before pulling back a little. That puts pressure on productivity and economic growth to do the heavy lifting when it comes to balancing the books.

"Japanese inflation is nearly at the Bank of Japan's target level of 2% but there are concerns that too much stimulus could see price increases accelerate again. The interplay between Governor Kazuo Ueda, and the newly emboldened premier will be the key dynamic to monitor, but markets look to be anticipating some pressure on state finances, with both the Yen and prices of government securities under pressure after the result."

Looking ahead to the rest of the week, Tuesday will see the release of results from BP, AstraZeneca and Barclays, among others. On the macro front, the delayed US non-farm payrolls report will be out on Wednesday, while UK fourth-quarter GDP figures are due on Thursday.

In equity markets, precious metals miner Fresnillo and gold miners Endeavour and Hochschild all shone as gold and silver prices rose.

Plus500 surged after saying its FY 2026 performance was set to be ahead of market expectations following a better-than-expected performance in 2025, as it announced "significant" shareholder returns.

Ocado was a smidgen higher following a report over the weekend that it's planning to cut up to 1,000 jobs, or 5% of its global headcount, as part of a renewed cost-cutting drive after a bruising year for its automated warehouse business.

According to The Times, talks are still in their early stages and a final decision has yet to be made

On the downside, NatWest slumped after saying it was buying UK wealth manager Evelyn Partners from funds advised by Permira and Warburg Pincus for £2.7bn and launching a new £750m share buyback. The bank said the deal would increase fee income by 20% pre-revenue synergies. Evelyn Partners has £69bn of assets under management.

Greggs was under the cosh after broker Jefferies said in a research note that weight-loss jabs could dent demand for the bakery chain's products.