The FTSE 100 closed at a record high on Thursday due in part to the drop in sterling sparked by concerns over a deadlock in Brexit talks.
London’s blue chip index rose 0.3 per cent or 22.43 points to end the day at an all-time closing high of 7,556.24.
David Madden, a market analyst at CMC Markets UK, said that the FTSE 100’s rise was primarily due to the pound’s declines, as multinational stocks on the index tend to benefit when foreign currencies are stronger than the pound.
“The bullish move was achieved for the wrong reasons, as the dip in the pound on the back of the stalled Brexit talks helped the British index,” he said.
Sterling was trading down nearly 0.4 per cent at 1.316 against the US dollar by the time the UK stock market closed, and 0.2 per cent versus the euro at 1.112.
Investors were spooked after the EU’s chief negotiator Michel Barnier said no “great steps forward” had been made during the fifth round of Brexit talks, and that there remained a “disturbing” deadlock over how much the UK should pay to settle commitments entered into as an EU member.
He said that the two sides had not even discussed the size of Britain’s Brexit bill, after the UK refused to put a figure on the amount it was prepared to pay.
Mr Madden said: “Traders are very sensitive to the UK’s exit from the EU.
“There was no major economic announcements from the UK today so the slight prospect of the UK leaving the EU and resorting to World Trade Organisation (WTO) trade rules sent sterling lower.”
The FTSE 100 easily outperformed its European peers, with the French Cac 40 ending the day down 0.03 per cent and the German Dax closing higher by 0.09 per cent.
In oil markets, Brent crude prices were down 0.2 per cent at $56.53 per barrel after figures released by the Energy Information Administration showed an unexpected increase in US gasoline stocks.
In UK stocks, HSBC shares fell 11.4p to 747p. The bank confirmed on Thursday that it had appointed John Flint – who currently heads its retail banking and wealth management division – as its new chief executive.
He will take up the role on February 21, replacing long-standing boss Stuart Gulliver.
Sky rose 13p to 926.5p after the company said in a trading update that the popularity of Game Of Thrones helped generate a five per cent rise in revenues to £3.3 billion for the first quarter amid a surge in new customers.
Carillion ended the day up 0.25p at 43.75p after the troubled infrastructure giant confirmed it had received multiple takeover bids for its UK healthcare business.
N Brown tumbled 19.3p to 330.7p as half-year results showed the retailer swung to a loss of £27.6 million, due to currency effects and exceptional costs linked to redress for customers for flawed insurance products it sold between 2006 and 2014.
Just Eat surged 46p to 749p on news that its takeover of rival Hungryhouse has been provisionally cleared by the UK’s competition watchdog.
The biggest risers on the FTSE 100 were St James’s Place up 46p at 1,176p, Hargreaves Lansdown up 40p at 1,536p, Burberry Group up 49p at 1,896p, and easyJet up 32p at 1,321p.
The biggest fallers on the FTSE 100 were HSBC down 11.4p at 747p, Smiths Group down 20p at 1,590p, Next down 61p at 4,989p, and Standard Chartered down 6.5p at 758.5p.
Source : HeraldScotland