LONDON MARKETS: FTSE 100 Slips As The Pound Hits 3-week High
March 20 2017 - 5:43AM
Dow Jones News
By Carla Mozee, MarketWatch
But blue-chip index still above 2,400, after reaching record
closes last week
U.K. stocks declined Monday, as a rise in the pound to a
three-week high weighed on the FTSE 100, which twice hit record
levels last week.
The FTSE 100 fell 0.2% to 7,411.20, with oil and gas, health
care and financial shares among those losing ground. On Friday, the
London benchmark added 0.1% to 7,424.96, a new record closing high.
That was the index's second close at a record in a row, and those
moves helped the blue-chip gauge gain 1.1% for the week.
This week started with the pound buying $1.2415, up from $1.2397
late Friday in New York. That is the highest level for the pound
since Feb. 27, when it hit $1.244, according to FactSet.
Blue-chip stocks tend to rise when the pound falls, as it boosts
the prospects of stronger earnings and sales for multinationals
that trade overseas.
The "pound is caught between last week's dovish [rate] hike from
the Fed, the Bank of England's non-unanimous rate vote, where
Kristen Forbes signaled that she believes an increase is in order,
and Tuesday's inflation figure, which is set to cross the BOE's
long-held 2% target," said Connor Campbell, financial analyst at
Spreadex.
"The FTSE didn't respond particularly well to this movement,"
although it's still hovering near 7,400, he added in his note.
G-20 fallout: There was also gloom over the equity market
following the weekend's Group of 20 meeting of finance ministers
and central bankers in Baden-Baden, Germany.
(http://www.marketwatch.com/story/little-economic-common-ground-found-at-g-20-meeting-2017-03-19)
The "G-20 meeting revived worries about the U.S.'s trade
protectionism as finance chiefs were brought to drop a reference to
fight protectionism in their joint statement," said Ipek
Ozkardeskaya, senior market analyst at London Capital Group, in a
note.
"Several leaders were left frustrated with the U.S.'s position
regarding the global trade under Trump administration, including
China, Japan, Russia, Germany and France," she said.
Stocks in focus: Vodafone Group PLC (VOD.LN) reached a deal to
merge most of its Indian operations with Idea Cellular Ltd
(http://www.marketwatch.com/story/vodafone-to-merge-india-unit-with-idea-cellular-2017-03-20-34851141).
(532822.BY), the country's third-largest mobile operator. Shares of
Vodafone were fractionally higher.
Unilever PLC (ULVR.LN) is looking at a GBP6 billion sale of its
spreads business, which includes the Flora and Stork brands,
according to a Sunday Times report
(http://www.thetimes.co.uk/article/unilever-lines-up-6bn-sale-of-flora-and-stork-87bxxlnd2)..
Shares were up 0.2%.
(END) Dow Jones Newswires
March 20, 2017 05:28 ET (09:28 GMT)
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