Pound weakness fails to lift FTSE as no-deal papers released

THE pound took a hit yesterday as currency traders took fright at the UK Government’s Brexit no-deal papers.

The documents published by Brexit Secretary Dominic Raab’s department detailed contingency plans designed to minimise the impact of Brexit on the cross-border movement of everything from money to medicines.

Sterling lost almost a cent against the dollar and nearly half a cent against the euro by close of trading in London, as traders weighed the potential consequences outlined in the papers.

Fiona Cincotta, senior market analyst at City Index, said the pound’s weakness reflected the fact that no-deal planning was “ramping up a gear”.

Sterling also suffered relative to the dollar as the US currency gained across the board following the Federal Reserve’s hawkish minutes the previous day, which suggested support for further increases to interest rates.

The FTSE 100 closed down 0.15pc at 7,563.22 on another relatively quiet day for markets.

Telecoms firm Talktalk led the gainers in the FTSE 250 index, with its shares closing up more than 8pc.

The company was boosted by an upgrade from analysts at Barclays, who said European telecom challengers were better equipped to compete than traditional incumbents.

Barclays said firms like Talktalk could gain market share from customers switching to more mobileonly services and 5G.

It also emerged yesterday that hedge fund Marshall Wace had reduced its bet against Talktalk, lowering its short position by nearly 7.5pc.

Quilter, the asset management firm spun out of Old Mutual, was one of the biggest fallers, down 8.65pc. The firm was one of nearly a dozen to go ex-dividend yesterday.

Another stock to lose ground was Kaz Minerals, down 5pc, as the strong dollar continued to punish metal miners.

Back in the FTSE 100, drug giant Astrazeneca’s shares slid nearly 1pc after its inhaler Bevespi suffered a setback in a clinical trial.

The medicine for chronic obstructive pulmonary disease (COPD) failed to match a product by arch rival GSK – Anoro Ellipta.

Astrazeneca said it would carry out “a full analysis” of the performance of Bevespi, adding that the trial was “inconsistent with previous data”.

The result is a setback for Astrazeneca as it tries to make up ground on GSK in the intensely competitive respiratory drugs market.

The oil price was down marginally amid reports oil giant Saudi Aramco may be cooling on plans to float on the London Stock Exchange. The price of Brent crude was down around 13 cents to $74.64 in early evening trading.