FTSE 100 pares back some of its Monday gains as sterling soars

“European markets have seen another positive session, although the FTSE 100 has slipped back

The FTSE 100 gave back some of its Monday gains as the index was weighed on by a strong performance from the pound yesterday.

By the end of the day London’s top shares had dropped 0.2%, losing 15.73 points and ending the day at 7,369.44.

Sterling rallied to a three-month high, trading up 1.1% to around 1.19 dollars by the time markets closed in London.

It came as US producer inflation figures (PPI) came in below expectations yesterday, and the markets look forward to the chancellor’s autumn statement tomorrow.

“European markets have seen another positive session, although the FTSE 100 has slipped back, failing again to hold above the 7,400 level, with the rise in the pound post US PPI appearing to act as a bit of a drag on the UK index,” said Michael Hewson, an analyst at CMC Markets.

The day after soaring to the top of the FTSE, online supermarket Ocado was bookmarking the index at the other end, dropping around 17% on the day.

Vodafone was also a major drag. The business reported a set of “lacklustre” figures, according to Mr Hewson.

The FTSE’S performance lagged behind its European peers, with Germany’s Dax and France’s Cac 40 both gaining half a per cent.

New York traders also pushed the main indexes into the green.

The S&P 500 gained 1.5% while the Dow Jones was trading up 0.7% by the time markets had closed in Europe.

The biggest risers on the FTSE 100 were Centrica, up 2.82p to 86.28p, Melrose Industries, up 4.2p to 131.4p, Scottish Mortgage Investment Trust, up 25.2p to 833.8p, BAE Systems, up 12.4p to 738.6p, and Rightmove, up 8.6p to 566p.

The biggest fallers on the FTSE 100 were Ocado, down 155.4p to 770.2p, Vodafone, down 8.27p to 95.89p, Endeavour Mining, down 50p to 1,656p, B&M, down 11p to 392.5p, and Severn Trent, down 68p to 2,688p.