European shares climb amid hopes for Brexit commerce deal

European stocks traded higher in a light trading session Thursday as traders grew optimistic a Brexit trade deal would be reached.

Britain’s FTSE 100 climbed 0.5% while France’s CAC added 0.3%. The German and Italian markets are closed for Christmas Eve.

British bank shares led the gains as traders bet a deal would be agreed soon, with Lloyds climbing 7%, Barclays rising nearly 4% and Natwest up over 3%.

Britain and the European Union are said to be on the cusp of striking a post-Brexit trade deal on Thursday. It comes after months of political wrangling over key sticking points such as fisheries.

U.K. Prime Minister Boris Johnson was due to speak with European Commission President Ursula von der Leyen at around 7 a.m. London time, the BBC reported. Johnson is then expected to hold a news conference an hour later.

Sterling climbed about 0.6% versus the dollar, trading at around $1.36. The euro was up 0.2% at $1.22.

In Asia, stocks were mostly higher as investors watched the latest Brexit developments. MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.5%.

On Wall Street, stock futures rose ahead of the final trading day of the holiday-shortened week.

President Donald Trump vetoed a sweeping defense bill Wednesday, breaking the Republican-led Senate. The move came after he called Congress’ long-delayed $900 billion coronavirus relief package an unsuitable “disgrace.”

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