The FTSE 100 has clawed back some of yesterday’s steep losses as investor sentiment is buoyed by China pledging support for its Covid-19-hit economy and Elon Musk’s successful $44bn (£34.6bn) bid for Twitter.

The blue-chip index was up 0.6%, or 46 points, at 7,426, recovering some lost ground as markets reacted positively to Twitter’s board accepting a bid by Musk, head of electric vehicle maker Tesla, to buy the social media platform for $54.20 a share, ensuring Wall Street closed higher overnight.

Victoria Scholar, head of investments at Interactive Investments, said the ‘sheer pace’ of the takeover offer has been ‘surprising’ given initial resistance from Twitter when Musk tabled a ‘final offer’ 11 days ago.

‘There are big questions ahead about what Musk’s leadership will mean for the company,’ she said, adding staff could be cut as the headquarters may be relocated to Texas.

‘There is likely to be an ideological shift in terms of the company’s focus away from content moderation and towards free speech instead.’

There was also upbeat news from China, where the central bank has pledged to support the economy during fresh lockdowns as the government holds firm on its zero-tolerance policy that saw Beijing become the latest city to face restrictions.

The news buoyed commodity stocks, the main losers yesterday, as the price of Brent crude rose 1% to push above $103 a barrel on hopes that Chinese demand will rebound as well as supply concerns as more buyers turn their backs on Russian oil.

Glencore (GLEN) was up 2.9% at 462p, Anglo American (AAL) added 2.5% to trade at £33.03, and Fresnillo (FRES) was up 1.7% at 760p.

There was also a strong showing from housebuilders, with Taylor Wimpey (TW) jumping to the top of the board, adding 3.5% to trade at 132p, after confirming it is on track to hit its operating margin target of 21-22% this year. It also declared a dividend of 4.4p and is carrying on with a £150m share buyback scheme.

Peer Barratt Developments (BDEV) was also pulled higher, adding 1.8% to reach 519p.

Associated British Foods (ABF) kept the FTSE in check, falling 3.3% to £15.75 as the Primark owner warned of mounting cost pressures.

Susannah Streeter, senior investment analyst at Hargreaves Lansdown, noted that despite Primark sales bouncing back, the group has warned it cannot offset rising costs with savings, so prices will have to increase.

‘This is a tricky manoeuvre to get right given that fans flock to Primark for high fashion at cheap prices,’ she said.

‘Even so, the company is confident it will stay well placed in the value proposition and reckons it can make progress in adjusted profits despite the pressures ahead.’

The FTSE 250 added 0.5%, or 102 points, to reach 20,701, with National Express (NEX) leading the mid caps higher. The coach company’s shares were up 8.6% at 244p, as revenues bounced back to 2019 levels in the first three months of the year.

Miner Ferrexpo (FXPO) was up 3.8% at 171p and shopping centre owner Hammerson (HMSO) added 2.8% to change hands at 30p.

Private equity surge

NB Private Equity (NBPE ) advanced 3.5% to £15.99 on strong annual results showing it achieved a 44.8% investment return last year, double the rise in the MSCI World index, and 2.9% more than a previous estimate, although asset value dipped 3% in the first quarter the company said in an update. Numis Securities estimated the shares traded on wide 32% discount to net asset value which they said offered value.

The news lifted the sector with Abrdn Private Equity Opportunities (APEO ) jumping 5.6% to 530p to narrow its 29% discount.

Ediston Property (EPIC ) rose 1.8% to 78.2p from a 20% discount on news of a 6.5% first quarter valuation increase for the retail warehouse portfolio.

Baillie Gifford China Growth (BGCG ) recovered some of yesterday’s falls, up 2.3% to 269.9p, as did Blackrock World Mining (BRWM ), benefiting from rising mining stocks to gain 2.4% to 671p.