FTSE hits a record high after pound slips back
THE FTSE 100 climbed to a record high as the pound fell amid concerns over the Brexit negotiations.
The index closed up 22.43 points at 7556.24, as the European Union’s chief negotiator Michel Barnier claimed that talks were at a deadlock.
The FTSE typically climbs when the pound falls as many of its members earn most of their cash overseas. The value of the pound slid to $1.32.
But the index was also pushed up by embattled builder Carillion, after it received proposals to buy its healthcare business.
Its stock has been in the doldrums since July when it plunged more than 70pc on a shock £845m writedown and suspension of dividends. Carillion, which builds and maintains schools, hospitals, barracks, roads and railways, is one of the biggest suppliers to the National Health Service.
It is trying to raise £300m by selling the healthcare arm and businesses in Canada, getting out of key markets, and perhaps also raising equity.
Yesterday, shares rose 0.6pc, or 0.25p, to 43.75p as it confirmed it had received proposals for the healthcare business from ‘more than one credible counterparty’. Also up were energy suppliers
Centrica and SSE, despite the Government publishing draft legislation on a price cap.
The two firms lost about £1bn market value combined last week when the plans were first announced. Yesterday, the business department said the cap would initially last until 2020, with the potential to be extended by up to three years, but gave no details on how it would be set. It is unlikely to come into force until after Christmas. Centrica, owner of British Gas, climbed 1.9pc, or 3.4p, to 179p, while SSE climbed 2.5pc, or 34p, to 1408p.
Budget airline EasyJet rose 2.5pc, or 32p, to 1321p amid reports that it was still in talks to snap up assets from insolvent German airline Air Berlin. Rival Monarch’s collapse has boosted the stock, which has climbed about 9pc in the past week.
But investors were muted about hopeful news from explorer Tullow Oil, which announced it had bought 90pc stakes in four onshore blocks in west Africa. State oil company Petroci owns the remaining 10pc of the stakes covering 5,035 square kilometres.
On the rise after battling large debts and restarting development of a field in Ghana, Tullow said the Ivory Coast licences could be quick and easy to produce from.
The news failed to excite investors, however, with shares dipping 1.1pc, or 2p, to 184.1p.
Weighing on the FTSE was
Renold, the supplier of industrial chains and power transmission products. Shares tumbled as bosses warned on profits, which they said have been dented by machine breakdowns at its factory in Einbeck, Germany, and rising steel costs. But group revenue grew 8pc.
Chief executive Robert Purcell said it had been a ‘frustrating’ first half but pledged that management actions should make a difference to the second half. Shares slumped 9.7pc, or 5p, to 46.5p. Troubled gold miner Acacia Mining also fell after it announced a drop in production over the latest three-month period, falling 8.3pc to 191,203oz compared with the previous quarter.
The firm is in a long-running battle with the Tanzanian government, which has banned the banned the export of unprocessed minerals and enacted new laws to raise state ownership of the nation’s mines.
But Acacia’s sales were up 3pc at 132,787oz. Shares fell 0.4pc, or 0.8p, to 189.1p.