MARKET REPORT
THE pound surged against the euro yesterday amid jitters over Catalonia’s independence and news that EU member states will start preparing for the second phase of Brexit talks.
Sterling was up nearly 0.9% versus the eurozone currency at 1.120 yesterday afternoon – a major move compared to the pound’s mere 0.2% rise against the US dollar to 1.317.
However, the currency’s move was bolstered in part by euro weakness.
The pound was also buoyed by economic data which showed that UK borrowing, excluding state-owned banks, unexpectedly dropped to £5.9bn, falling by £700m compared to a year earlier, making it the lowest September figure since 2007.
The outcome means Government borrowing for the current financial year, April to September, also dropped by £2.5bn to £32.5bn – also the lowest level for 10 years.
The FTSE 100 ended the day flat, up just 0.19 points at 7,523.23 points.
Across Europe, the French Cac 40 ended the day up 0.08%, while the German Dax edged up just 0.01%.
Brent crude prices rose 0.4% to $57.51 as tensions in the Middle East slowed the flow of oil from the likes of Iraq’s Kurdistan.
In UK stocks, InterContinental Hotels Group (IHG) dropped 37p to 4,062p after reporting a mere 2.3% rise in third quarter revenue per room. Across its European operations, that figure grew 7.1% and contrasted sharply with just a 0.8% increase in the Americas, where hurricanes Harvey and Irma had a “mixed impact” on the business.
Interserve shares surged 11p to 76.5p following news that the troubled outsourcing and construction group won a £227m Government contract. It comes just one day after the company issued a profit warning that sent its shares plunging over 30%.
The five-year contract will see the company provide facilities management services for the Department for Work and Pensions (DWP) as well as cleaning, catering, waste disposal, removal and confidential waste services across 700 buildings.
The biggest risers on the FTSE 100 were Standard Chartered up 23.4p at 772.1p, NMC Health up 78p at 2,908p, Rentokil Initial up 7.6p at 321.6p, and RSA Insurance Group up 15p at 641p.
The biggest fallers on the FTSE 100 were Fresnillo down 51p at 1,367p, Unilever down 138p at 4,161p, Reckitt Benckiser Group down 180p at 6,610p, and Shire down 71p to 3,677.5p.