Weakness of sterling boosts FTSE 100

London’s premier index fell just short of a new record as sterling’s weakness and robust UK economic data gave a lift to blue-chip stocks.

The FTSE 100 Index closed up 23.82 points at 7,543.77 but came in shy of the record alltime closing high of 7,547.63 achieved on May 26.

The top flight rebounded yesterday as the pound suffered a tumultuous session on the currency markets as the latest polling data from YouGov put the Conservatives just three points ahead of Labour.

Blue-chip companies, which report in US dollars or euros, get a lift on the FTSE 100 Index when the pound struggles because their earnings benefit from a more favourable currency translation.

However, sterling made a resurgence later in the session – trimming back gains on the FTSE 100 – as traders became more confident that the Tories will return to power after June 8. The pound was up 0.2% versus the US dollar at 1.289 and 0.5% higher against the euro at 1.150.

Connor Campbell, financial analyst at Spreadex, said election jitters had eased in the afternoon as traders reassessed the election data from the polls.

He said: “It appears that, while the morning’s YouGov poll puts the Tories just three points ahead of Labour, there are enough surveys giving Theresa May and co a larger lead to allay the currency’s fears of anything but a Conservative landslide.

“This meant some juice was sucked out of the FTSE, its gains roughly halving to 0.2% as the day went on.”

Across Europe, Germany’s Dax was up 0.4% and the Cac 40 in France was 0.7% higher.