European and US stock markets advanced yesterday, mirroring gains in much of Asia on hopes of progress in looming China-US trade talks, dealers said.

In afternoon trading, London’s benchmark FTSE 100 index was up 0.1 per cent, while Frankfurt was marginally higher and Paris won 0.4 per cent. Wall Street opened higher, with the Dow edging up 0.1 per cent.

The pound slid despite European Commission chief Jean-Claude Juncker’s apparent hint that a Brexit deal was still possible, with Britain due to leave the European Union at the end of next month.

With a delegation from China in the United States to prepare for higher-level negotiations next month, investors hope the economic giants can find a solution to their tariffs row that has been a drag on the global economy for a year.

Stock markets have enjoyed a broadly positive September thanks to hopes for the talks, with both sides appearing to offer olive branches and sounding less confrontational than they did in July and August.

Equities remain supported by central bank shifts towards easier monetary policy, although there was some disappointment in the Federal Reserve’s lack of forward guidance this week for further interest rate cuts.