London close: Pound strength sees Footsie miss out on gains
Stocks finished in the red on Tuesday, with President Donald Trump's latest swipe at the value of the US dollar seeing investors in London left out from the gains evident in almost all other major stockmarkets, or at least those invested in the top-flight index.
The FTSE 100 was down by 0.34% or 25.56 points at 7,565.70, while the pound was 0.4% higher against the dollar at 1.28511 and up by 0.06% versus the euro at 1.1153.
Investors on the second-tier index on the other hand were cheered by a 111.71 point or 0.54% gain to 20,642.86.
Meanwhile, in the States, the S&P 500 was within a whisker of hitting a record high, gaining 0.46% or 13.22 points to 2,870.41.
The US dollar weakened after Trump criticised the Federal Reserve again for lifting interest rates and accused China and Europe of manipultaing their curencies. In an interview with Reuters, Trump said the Fed should do "what's good for the country".
Neil Wilson, chief market analyst at Markets.com, said: "Trump’s not thrilled with the Fed raising rates. At the same time, he accused China and the EU of currency manipulation. Taken together with previous comments we see a clear pattern of the president willing to talk the USD lower whenever it starts to look a bit toppy. Two ways to look at this: one if done enough times it can exert a powerful influence over market expectations. Two, comments like these will produce diminishing returns for the president.
"I think on this one the market will come round again and the dollar bounce back, but nonetheless it does appear the market is worried that the president will exert influence on Fed policy."
As far as the UK is concerned, Jeremy Hunt will make his first appearance in the US as foreign secretary on Tuesday. He is due to make a speech at a Q&A in Washington during which he is expected to warn Brussels that a failure to strike a Brexit deal would destabilise the international order and urge President Trump to impose wider sanctions against Russia.
In a keynote speech earlier to business leaders in London, international trade secretary Liam Fox said Britain could become an "exporting superpower" after it leaves the EU, as he announced a new export strategy aimed at increasing the country's total exports to 35% of GDP.
On the data front, figures released earlier revealed that the government had its biggest July surplus for 18 years, giving Philip Hammond room for spending within his self-imposed fiscal constraints as the chancellor prepares his annual budget.
Public sector net borrowing, excluding public sector banks, showed a surplus of £2.0bn for July - £1bn more than a year earlier, official figures showed. The result was the biggest surplus for July since 2000 and beat than the £1.1bn average surplus forecast in a Reuters poll of economists.
The surplus took net borrowing for the first four months of the current financial year to £12.8bn - a reduction of £8.5bn from a year earlier and the lowest net borrowing at this point since 2002.
Elsewhere, the latest survey from the Confederation of British Industry showed the total orders balance fell to +7 in August from +11 in July, just below consensus expectations of +8.
In corporate news, BHP Billiton was in the red even as it declared a record final dividend as higher prices and volumes sent the miner’s underlying annual profit up by a third.
Morrisons was the biggest gainer after Kantar said its sales grew 2.7% in the 12 weeks to 13 August, making it the fastest-growing of the 'big four' supermarkets again.
Persimmon dipped after it reported a 13% increase in profits from the first half of the year as the housebuilder sold 4% more homes and the average selling price increased 1% to £215,813.
AstraZeneca was also in the red, even after it announced that the Japanese Ministry of Health, Labour and Welfare has approved ‘Tagrisso’ (osimertinib) for the first-line treatment of patients with inoperable or recurrent epidermal growth factor receptor mutation-positive non-small cell lung cancer, following priority review.
Wood Group jumped as it posted a loss for the first six months of the year but a rise in revenues.
Shares of Polymetal were also trading on the front foot after the gold-digger reported a 46% jump in first-half net income, while Charter Court Financial Services gained ground after it posted a rise in first-half profit as loans roses and the company announced an inaugural dividend.
In broker note action, Aggreko was upgraded to 'buy' at HSBC, while Weir was lifted to 'outperform' at Credit Suisse.
Bodycote was downgraded to 'sell' at Panmure Gordon.
Market Movers
FTSE 100 (UKX) 7,565.70 -0.34%
FTSE 250 (MCX) 20,642.86 0.54%
techMARK (TASX) 3,554.33 0.06%
FTSE 100 - Risers
Kingfisher (KGF) 276.90p 2.48%
Ocado Group (OCDO) 1,079.50p 1.94%
Sage Group (SGE) 629.20p 1.61%
Morrison (Wm) Supermarkets (MRW) 268.05p 1.61%
Evraz (EVR) 486.10p 1.33%
Royal Bank of Scotland Group (RBS) 246.80p 1.19%
Admiral Group (ADM) 2,057.00p 1.13%
Standard Life Aberdeen (SLA) 321.30p 1.07%
Sainsbury (J) (SBRY) 338.00p 1.05%
Legal & General Group (LGEN) 256.20p 0.87%
FTSE 100 - Fallers
British American Tobacco (BATS) 4,122.50p -2.37%
Imperial Brands (IMB) 2,923.50p -2.11%
BHP Billiton (BLT) 1,610.60p -2.10%
Hargreaves Lansdown (HL.) 2,160.00p -1.86%
Compass Group (CPG) 1,682.00p -1.58%
TUI AG Reg Shs (DI) (TUI) 1,452.00p -1.53%
NMC Health (NMC) 4,058.00p -1.50%
Informa (INF) 768.00p -1.44%
Bunzl (BNZL) 2,319.00p -1.40%
Rio Tinto (RIO) 3,669.00p -1.36%
FTSE 250 - Risers
Wood Group (John) (WG.) 712.00p 7.65%
Rank Group (RNK) 175.60p 6.59%
IntegraFin Holding (IHP) 365.00p 5.65%
Aggreko (AGK) 882.00p 4.73%
Just Group (JUST) 93.60p 4.52%
SIG (SHI) 127.00p 4.01%
Euromoney Institutional Investor (ERM) 1,384.00p 3.44%
Rathbone Brothers (RAT) 2,496.00p 3.23%
Card Factory (CARD) 183.60p 3.21%
BCA Marketplace (BCA) 234.00p 3.08%
FTSE 250 - Fallers
Hill & Smith Holdings (HILS) 1,068.00p -6.32%
Syncona Limited NPV (SYNC) 272.50p -5.71%
Safestore Holdings (SAFE) 535.50p -3.81%
Thomas Cook Group (TCG) 82.15p -3.41%
Indivior (INDV) 262.90p -3.10%
Metro Bank (MTRO) 2,888.00p -3.08%
Bodycote (BOY) 995.00p -2.16%
Genus (GNS) 2,800.00p -2.04%
Ferrexpo (FXPO) 153.10p -1.67%
IWG (IWG) 238.00p -1.65%