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FTSE 100 closes higher as Brexit returns into view

Last updated: 17:14 28 Mar 2017 BST, First published: 07:10 28 Mar 2017 BST

stock market
  • FTSE 100 closes 49 higher at 7,343

  • US markets improve as consumer confidence climbs

  • Wolseley best of the risers

  • Brexit trigger coming into view

 

FTSE 100 continued its climb into the close and finished 49 points higher at 7,343.

It comes as traders await tomorrow the formal trigger of Article 50 and the UK's journey to leave the EU.

The Dow is up 0.43% at the time of writing on Wall Street.

Some believe the premier index will see good gains from the Brexit process as sterling weakens helping its dollar-earning constituents.

Joshua Mahoney at spreadbetter IG Index noted: "The FTSE has managed to remain in the green for much of the day, despite the looming clouds of Brexit which hang overhead.

"Tomorrow’s Article 50 activation represents a historic day, yet the implications for the markets are less certain. For FTSE bulls, there is a feeling that Brexit worries could cause further sterling devaluation, helping out UK firms in the international marketplace."

The analyst adds that for some firms, plans to relocate operations and jobs out of the UK will have been dependent upon the government actually activating Article 50.

Plumbers' merchant Wolseley PLC (LON:WOS) was top dog on the index, with shares adding 5.06% to 5,130p on better than expected numbers.

Miners also went higher with copper giant Rio Tinto (LON:RIO) adding 2.81% to 3,220p.

The biggest loser was Associated British Foods plc (LON:ABF), which shed 1.43% to stand at 2,612p.

3.15pm..London shrugs off topor

London shrugged off its early torpor and made good progress towards the end of the day as US stocks pushed on.

FTSE100 was 24 points higher at 7,295 as the Dow Jones opened 35 points higher led by resource groups on reports climate change laws are next in the sights on US President Donald Trump.

A huge uptick in US consumer confidence also supported Wall Street, with the number hitting a 16-year high.

Wolseley PLC (LON:WOS) remained the stand-out performer adding 5% to 5,132p on better than expected numbers.

Royal Bank of Scotland PLC (LON:RBS) was flat as it is set to raised the amount if compensation it pays shareholders who invested in its disastrous £12bn rights issue in 2008.

The RBOS Shareholder Action Group, the last of the groups chasing compensation, are set to be offered 43.5p per share but will reject it, according to reports today.

Some shareholders are said to be holding out for more than double that sum. A trial is scheduled for May. Shares added 1.7p to 240.5p.

12.00...FTSE 100 marks time with US tipped for slow start

London struggled to recoup yesterday’s losses with a raft of corporate news, failing to give much of a kick.

After larger gains earlier in the day, FTSE100 was just one point higher at 7,295 as investors started to look towards the opening of the US markets.

Spread bet firms see the Dow Jones Industrial Average up a few points. The index managed to claw back a good chunk of its early fall by the close on Monday.

Wolseley PLC (LON:WOS) was the stand-out performer adding 6% to 5,166p on better than expected numbers.

To underline the changing emphasis at the building materials  group, the PLC’s name will change from Wolseley to Ferguson, the name of the US subsidiary.

Redrow plc (LON:RDW) meanwhile has walked away from its flirtation with rival housebuilder Bovis Homes PLC (LON:BVS), which presumably leaves the way clear for Galliford Try PLC (LON:GFRD) if it is inclined to carry on its pursuit.

Bovis shares eased a few pennies to 853p but it is under severe pressure after it had to compensate customers over the build quality of its homes and shed its chief executive.

Next Plc (LON:NEX) continued its recent rally , but gold miner Randgold Resources PLKC was a faller despite a commitment to a big dividend increase. Shares fell 1.4% to 7,075p.

Elsewhere, Sirius Minerals PLC (LON:SXX), the developer of the North Yorkshire polyhalite project is moving from Aim to the main market.

Shares were up 7.5% at 18.82p as the company added its flagship project remains on time and on budget.

Restaurant operator  Tasty Plc (LON:TAST) left a bad taste with its backers.

The Wildwood restaurants operator posted a pre-tax loss of £88,000 for 2016, versus a profit the year before of £3.07mln, after taking £3.58mln of impairment charges.

Worse still, the company said 2017’s headline operating profit is expected to be lower than 2016’s, which was £4.8mln.

The shares tumbled 28% to 82p.

 

8.45am...FTSE 100 opens higher, Wolseley stars and Sirius gets serious

The FTSE 100 bounced (though only a little) following Monday’s sell-off to trade 11 points higher at 7,304.83 early on.

Market watchers said there is a still a degree of nervousness following President Trump’s failure to push through his healthcare reforms and ahead of the formal triggering of Article 50.

On the corporate front, the plumber’s merchant Wolseley (LON:WOS) was the stand-out feature.

It jumped 7% early after a better than expected set of prelims. The financial stocks and miners, victims of Monday’s clear-out, were also in demand.

Investors in Tesco (LON:TSCO) were unmoved by the grocer’s settlement with the Serious Fraud Office, its ensuing £129mln fine or the fact one of its major investors has come out against its acquisition of cash and carry firm Booker.

Sirius Minerals (LON:SXX), one of the larger companies on AIM, rose 7% after it update on progress on developing a giant potash mine in North Yorkshire.

It also confirmed plans to exit the junior market where with a market capitalisation of plus-£700mln it is one of the big boys.The FTSE 100 is expected to open 25 points higher at 7,318 after US stocks closed mixed.

 

6.45am...strong open predicted

Traders in the US continued to weigh US President Donald Trump’s defeat on the health bill, which analysts believe casts doubt on the rest of his policies.

On this side of the pond, the attention is squarely on Theresa May as she prepares to trigger Article 50 tomorrow, beginning the formal process of Brexit.  The worry is that the UK may exit from the European Union without a trade deal after May said “no deal is better than a bad deal”.

“We still believe there is a good chance that the UK and EU27 will agree a post-Brexit trade deal in the end,” said Berenberg.

“However, the issues that led to Brexit in the first place could again turn into points of contention. Migration remains the key concern.”

On the company front, investors are sifting through a raft of results and trading statements, including from AG Barr plc (LONBAG), Thomas Cook Group (LON:TCG) and Card Factory (LON:CARD). 

Newspaper headlines

  • Two of Tesco's largest shareholders have chastised the supermarket for its "foolhardy" £3.7bn merger with wholesaler Booker, arguing the deal would destroy billions of pounds worth of value, reports both the Telegraph and Times. Schroders, the grocer's third biggest investor, and Artisan Partners, the fourth largest, have written to Tesco's board to urge the company to abandon its tie-up with Booker, throwing the deal into doubt.
  • Britain’s biggest banks are to be put through the toughest ever set of stress tests after the Bank of England said that it would make an additional assessment of banks’ business models alongside its usual health checks, writes the Times.
  • A boycott of Google by some of the world’s largest companies will cost it more than US$750mln a year, analysts at Nomura have predicted, reports the Times
  • Germany has hardened its stance on Brexit reports the FT as Theresa May prepares to trigger Article 50. Chancellor Angela Merkel, who made accommodating noises after last summer’s referendum, has adopted a tough position on issues such as the UK’s exit bill and the sequencing of negotiations.
  • Troubled Cobham is being investigated by regulators over its handling of inside information before it issued a profit warning and a £500mln emergency cash call, writes the Mail.

Commodities/currencies

£/$  - 1.2547 pound down slightly

Gold – US$1,251 down US$3

Oil (WTI) – US$48.01 up US$0.28

 

 

 

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