Airlines fall on quarantine turbulence

The pound has tumbled against the US dollar as concerns ramped up over a no-deal Brexit, but London’s top tier shrugged off big falls on Wall Street amid America’s hefty tech sell-off.

Sterling tumbled 1.6 per cent to just over $1.30 – the lowest level for nearly a month and the steepest fall since March – following the shock departure of the UK government’s legal head. The pound was also down heavily against the euro, falling 1.4 per cent to €1.11, after Sir Jonathan Jones resigned amid reported anger over suggestions Boris Johnson is planning to override elements of the Brexit Withdrawal Agreement.

The FTSE 100 clung to its opening mark, down 7.1 points or 0.1 per cent at 5,930.3, despite heavy opening falls in the US.

Craig Erlam, senior market analyst at Oanda Europe, said further falls in the pound could be likely as the latest round of UK-EU talks play out. “Traders are likely to continue to be very sensitive to anything that jeopardises an agreement and leaves the UK facing a global pandemic, high unemployment and no-deal all at the same time,” he added.

At the time of close in London, the Dow Jones Industrial Average had dropped 1.6 per cent, resuming the tech rout seen last week as traders returned following the Labour Day holiday on Monday.

Among UK stocks, sterling’s fall gave a fillip to the likes of Scotland’s largest whisky producer Diageo, which closed up 57p at 2,600.5p, for example.

Beleaguered airlines were back in the spotlight again after Easyjet revealed it is to cut flights following the UK government’s decision to impose quarantine restrictions for seven Greek islands. Shares in the FTSE 250 firm closed down 31p to 597.4p.

British Airways owner IAG also sunk into the red, down 1.4p to 207.8p.

It capped a turbulent final day for IAG chief executive Willie Walsh, who was also at the centre of an investor protest over pay after nearly one in three shareholders failed to back his remuneration deal.

Elsewhere, JD Sports topped the FTSE risers board – ending the day up 71.2p to 795.8p – after it reinstated its dividend, which offset results showing pre-tax profits for the six months to 1 August slipped by 68 per cent to £41.5 million.