FTSE recovery continues but fears remain

Market report Emma Newlands

London’s blue-chip index extended its recovery following losses last week, thanks to a relatively quiet day across European markets.

The FTSE 100 rose 21.97 points to 7,275.25, as it continued to gain strength after suffering on the back of a stronger pound last week.

Many of the index’s multinational components tend to benefit when foreign currencies are stronger.

David Madden, a market analyst at CMC Markets UK, warned that while the FTSE 100 was bouncing back, it could struggle to climb much further. “Last week, the British market crashed through the significant 7,300 region, and if that mark isn’t re-taken, the wider bearish outlook could remain,” he said.

His warning comes during a relatively quiet trading day for European markets, with many investors looking ahead to Prime Minister Theresa May’s highly anticipated Brexit speech in Italy on Friday.

Sterling was trading relatively flat against major currencies, up 0.1 per cent versus the US dollar at $1.351 and down 0.05 per cent against the euro at €1.128.

Speedy Hire rose 0.5p to 51.75p as the company upped its outlook for annual profits now expected to come in “well ahead” of last year, following a cost-cutting drive.

The biggest risers on the FTSE 100 included International Consolidated Airlines Group, up 15.5p to 606.5p, J Sainsbury ,up 6.1p to 243.1p, and Johnson Matthey ,up66p to 2,976p. The biggest fallers included Tui AG, down 29p to 1,287p, Carnival, down 78p to 4,760p, and Antofagasta, down 13.5p to 940p. The group was one of many boosted by Kantar Worldpanel data recording a 3.6 per cent jump in supermarket sales for the 12 weeks to 10 September. The online grocer fell despite higher third-quarter retail income after saying costs from the set-up of new distribution centres could hit earnings.