Mar­kets

The Daily Telegraph - Business - - Front Page - CHAR­LIE TAY­LOR-KROLL

THE FTSE 100 lagged its con­ti­nen­tal ri­vals af­ter the pound was pro­pelled to a five-month high against the euro by resur­gent hopes of a Brexit deal.

The cur­rency’s rally spilt over into a sec­ond day as a roller­coaster ride high­lighted its hyper-sen­si­tiv­ity to Brexit head­lines. Af­ter its early gains were erased by the DUP warn­ing that the UK is “head­ing for no deal”, rest­less cur­rency traders latched on to Brexit Sec­re­tary Do­minic Raab giv­ing a crunch Cab­i­net meet­ing the “thumbs up”.

Spec­u­la­tion that a deal could be reached be­fore the end of the week helped ster­ling rally as much as 0.4pc ver­sus the euro to €1.1466, its high­est level since May, while it flirted with the $1.31 mark against the dol­lar af­ter climb­ing 0.6pc.

The FTSE 100’s in­ter­na­tional earn­ers weighed heav­ily on the in­dex as the pound’s leap re­duced the rel­a­tive value of their earn­ings. Sink­ing dol­lar earn­ers Bri­tish Amer­i­can To­bacco and As­traZeneca dragged the in­dex to a 63.16-point loss at 7,040.68.

Else­where, oil prices slumped to their low­est level in 12 weeks as sup­ply short­age fears fiz­zled out. The US has granted waivers to sev­eral coun­tries im­pacted by its sanc­tions on Ira­nian oil ex­ports, in­clud­ing China and In­dia.

Brent crude tum­bled as much as 2.7pc to $73.28 per bar­rel late in af­ter­noon trad­ing as Royal Dutch Shell ‘B’ slid 27.5p to £24.56.

Em­bat­tled re­gional air­line Flybe took off af­ter HSBC ad­vised in­vestors to snap up a bar­gain fol­low­ing its re­cent share price col­lapse.

It told clients in an up­grade to “buy” that a flurry of deal­mak­ing in the sec­tor could sweep the UK re­gional air­lines. “The com­pany has as­sets that have value which we think the mar­ket is cur­rently ig­nor­ing,” an­a­lyst Achal Ku­mar said as Flybe climbed 0.6p to 11p, a 5.8pc surge.

Min­ing gi­ant Glen­core slipped back 9.3p to 311.9p af­ter halt­ing op­er­a­tions at a key cobalt mine in the Demo­cratic Repub­lic of Congo on dis­cov­er­ing ura­nium in the bat­tery ma­te­rial mined from the site.

Katanga Min­ing, which op­er­ates the mine on be­half of Glen­core, said that it is re­mov­ing the ura­nium at a cost of around $25m (£19m) but would face dis­rup­tion at the mine un­til the end of the sec­ond quar­ter in 2019.

Oil and min­ing ser­vices com­pany Weir ral­lied 76.5p to £15.89 de­spite warn­ing that the slow­down in the US shale in­dus­try would hit its full-year prof­its. It re­as­sured in­vestors with surg­ing or­der growth from its min­ing busi­ness.

Ad gi­ant WPP slipped 12.8p to 881p af­ter JP Mor­gan warned that it has missed out on ac­cel­er­at­ing growth in the be­lea­guered mar­ket­ing in­dus­try. Lloyd’s of London in­surer His­cox’s slide ex­tended into a sec­ond day as City scrib­blers piled on the pres­sure with price tar­get cuts.

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