Rising sterling drags Footsie back into red

The pound shrugged off further Brexit developments to notch up a rise on Monday.

Sterling closed up 0.5 per cent at $1.315 and up 0.1 per cent against the euro at €1.124, despite International Monetary Fund warning a nodeal scenario would inflict “substantial costs” on the UK economy.

Craig Erlam, senior market analyst at OANDA, said: “While the forecasts are gloomy, the expectations for a deal appear to be improving along with the more conciliatory comments in the media which is providing support to sterling.”

Prime Minister Theresa May also put her foot down, saying MPS must agree to the Chequers Brexit proposals or leave the EU without a deal.

The FTSE 100 ended the day down 1.94 points at 7.302.1, dragged down by the stronger pound.

Top-flight mining stocks lost ground on the back of fresh trade concerns when US president Donald Trump said tariffs put the country in a “very strong bargaining position”. Glencore and Antofagasta slid 1.2p and 7.6p, respectively.

Elsewhere on the London market, there were two contrasting stories of cost inflation. Cathedral City maker Dairy Crest said half-year profits are set to rise despite the higher price of butter, pushing shares up 8p.

But Finsbury Food Group profits tumbled 66 per cent and shares slipped by 3p as it contended with “unprecedented” inflation and the closure of its loss-making pastry factory.

The biggest risers on the FTSE 100 included SSE, up 38.5p to 1,122.5p, and Evraz ,up12pto 495.7p. The FTSE 100 biggest fallers included GVC Holdings, down 36p to 995p, and Burberry, down 44p to 2,109p.