London close
London’s blue chip index dipped into the red at the close though only marginally as investors paused for breath after recent strong gains.
FTSE 100 closed two points lower at 6,681 despite new highs on Wall Street as Tory Home Secretary Theresa May started planning for her move into No. 10 tomorrow.
But traders were already looking elsewhere, with Bank of England governor Mark Carney telling MPs that he had warned the UK of a falling pound and a worsening economy if it decided to quit the EU.
Several investment banks and a string of blue-chip corporates have already warned of job losses and possible moves out of London and the UK.
Carney denied accusations of scare-mongering, saying the bank issued its warnings after robust discussions among members of its financial policy committee.
On the markets, Nigeria-focused Sirus Petroleum PLC (LON:SRSP) spurted 18.2% to 0.33p after the West African nation agreed to renew the Ororo field licence for three years.
RhythmOne PLC (LON:RTHM) shot up 12.1% to 32.25p on news that the online advertiser, formerly known as Blinkx, expects first-quarter trading to beat its hopes.
Orchard Funding Group PLC (LON:ORCH) lost a fifth of its value to 87.5p as the finance company forecast flat annual revenues and full-year trading below market expectations.
Shares in insolvency specialist Begbies Traynor Group PLC (LON:BEG) fell 13% to 46.8p after a 9% fall in national insolvency appointments in the year to March 2016 hit revenue and profit.
Back in the top flight, risers included Shire Plc (LON:SHP) after the US Food & Drug Administration approved the company's dry-eye disease drug. Shares lifted 0.8% to 4,856p.
But Vodafone Group PLC (LON:VOD) backtracked 1 % to 227.7p and AstraZeneca PLC (LON:AZN), on Monday the subject of speculation that it could buy US rival Medivation Inc, down 1.8% at 4,475p.
Preview at 6.50am
Having rallied to an eleven month high yesterday, Tuesday promises a more tepid start for London’s FTSE 100.
The promise of a new Prime Minister sooner rather than later - as Theresa May emerged as the last one standing in the Conservative party’s leadership race - was a boost to equities following on from Bank of England’s latest supportive pledge and positive US employment stats.
Most stock benchmarks now measure recoveries from the worst of the Brexit shocks.
“With the political transition likely to be done and dusted by the middle of the week, we could well find out quite quickly what the next steps are with respect to time lines and intentions with respect to the UK’s relationship with the EU and article 50,” said Michael Hewson, analyst at CMC Markets.
“It would seem that for now financial markets like the idea of a known quantity at the head of government in the form of Theresa May as opposed to the unknown quantity that was Andrea Leadsom, that being said our new PM isn’t likely to get too much of a honeymoon period.”
Monday saw Wall Street advance, with the Dow Jones rising 80 points or 0.44% to 18,226. The S&P 500 added 0.34% to 2,137 while the Nasdaq gained 0.64% to 4,988.
In Asia, Japan’s Nikkei advanced 2.5% to 16,107. Hong Kong’s Hang Seng rose 0.7% to 21,028 and the Shanghai Composite gained 0.5% to 3,011.
Australia’s ASX 200 move 0.5% higher to 5,363.
In the commodities market crude oil lost just over 1% with Brent changing hands at around US$46.25 per barrel.
London’s FTSE 100 is expected to start Tuesday on the back foot, with CFD and spreadbetting group IG Markets seeing the benchmark almost 20 points lower at 6,660 to 6,665 about an hour before stock market trading begins.