FTSE 100 Surges as Travel Stocks Lift Market, Eyes on Labour Data

London's FTSE 100 increased by over 1%, driven by gains in travel and leisure stocks, as gambling group Entain posted an optimistic forecast. The index saw its largest one-day rise in a month, while the mid-cap FTSE 250 had its best performance in three weeks, rising 0.8%. Investors are now looking ahead to crucial labour market data.

London's benchmark FTSE 100 climbed over 1% amid broader gains led by travel and leisure stocks following an optimistic forecast from the gambling group Entain. Investors are keenly awaiting labour market data due later in the week.

The blue-chip FTSE 100 closed up 1.1%, marking its biggest one-day gain in a month. The mid-cap FTSE 250 advanced 0.8%, recording its best day in three weeks. Travel and leisure stocks surged 1.9%, hitting a six-week high, as Entain reported that its online revenue growth in the latter half of the financial year exceeded expectations. The gambling group topped the FTSE 100 gainers with a 5.3% rise.

HSBC shares added 1.9% after Bloomberg News reported that the bank was considering merging its Commercial and Investment banking divisions to cut costs and eliminate overlapping roles. The broader banks index was up 1.7%. Most major sub-sectors also traded higher, with chemicals and automobiles up 1.9% and 1.7% respectively. However, luxury retailer Burberry fell 4.9% following a downgrade by Barclays, while British restaurant operator Hostmore plummeted over 90.8% after abandoning plans to purchase TGI Fridays.

In other developments, a survey indicated that Britain's labour market had cooled last month, which might support arguments for interest rate cuts by the Bank of England. Investors are awaiting key labour market data and GDP figures due this week for further insights on the Bank's stance. The British central bank is anticipated to hold rates at its upcoming meeting, whereas the European Central Bank is expected to announce a rate cut.

(With inputs from agencies.)