FTSE 100 watch: Stronger sterling weighs on Footsie

Ashtead share price rallies as group posts first-quarter results

FTSE 100 watch: Stronger sterling weighs on Footsie

The UK benchmark index has slipped into the red in today’s session, giving up some of yesterday’s gains, with a rise in the pound weighing on blue-chips with international exposure. Ashtead (LON:AHT) meanwhile has soared to the top of the FTSE 100 leaderboard after updating investors on its first-quarter performance and flagging benefits on the back of this year’s hurricane season.  

As of 12:45 BST, the FTSE 100 had given up 17.15 points to stand 0.23 percent lower at 7,396.44. The Footsie has retreated as the latest inflation data pushed sterling higher amid expectations that a Bank of England (BOE) rate hike could come sooner than previously expected.

Samuel Tombs, chief UK economist at Pantheon Macroeconomics, however, noted that he thought the prospects of a rate hike this year were ‘remote’.

“Domestically-generated inflation is subdued, inflation expectations have remained well-anchored and GDP growth is too weak to warrant higher rates,” he told the BBC.

In individual movers, shares in Ashtead have been in demand as the company posted a rise in revenue and earnings for the first quarter, and further flagged higher demand for its fleet due to Hurricanes Harvey and Irma.

“Insurers and reinsurers are clearly the most exposed (though we note the change in Irma’s path has given some respite to the share prices of these stocks in the last 24 hours) whilst those exposed to reconstruction and replacing insured capital stock are likely to see a pick-up in demand over the next few months,” said Edward Park, investment director at Brooks Macdonald, as quoted by Reuters. Ashtead’s share price is currently 7.13 percent better off at 1,804.00p.

The FTSE 100 index was 0.23 percent down at 7,396.84 points as of 14:27 BST on Tuesday, 12 September 2017.

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