FTSE 100 watch: Footsie heads south after Brexit speech

on Jan 17, 2017
Updated: Mar 11, 2020
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The UK benchmark index has extended this morning’s losses in afternoon trade, as Prime Minister Theresa May promised a parliamentary vote on Britain’s deal to leave the European Union, which propped up sterling. She further noted that she would rather leave EU with no trade deal than accept a bad one.

As of 13:08 GMT, the FTSE 100 had shed 55.84 points to stand 0.76 percent lower at 7,271.29, having traded about 0.4 percent in the red earlier in the session. The Footsie has extended its morning losses as Prime Minister Theresa May’s highly-anticipated speech sent the pound higher, pressuring blue-chip stocks with international exposure. The pound has gained ground after the Prime Minister said that the government will put the final Brexit deal to a vote in both houses of parliament.

“It is worth remembering that since the Brexit vote last June, rallies in the pound have been fairly weak, while sell offs have been harsh and prolonged. It is too early to know if the negative impact of politics on the UK currency is starting to wane,” Kathleen Brooks, research director at City Index, noted, as quoted by the Guardian.
May’s comments that she will pursue a ‘bold and ambitious’ free trade agreement with the EU have also weighed on market sentiment.

“What I am proposing cannot mean membership of the EU single market,” she pointed out, as quoted by The Telegraph.
In individual movers, Rolls-Royce Holdings (LON:RR) has climbed to the top of the FTSE 100 leaderboard after the British engine maker settled bribery claims in the UK, the US and Brazil and noted that it had had a good finish to 2016 with both profit and cash forecast to be ahead of expectations. The group’s shares are currently changing hands 6.33 percent higher at 707.09p.
Standard Chartered (LON:STAN) has been another notable Footsie riser, benefitting from a rating upgrade at Bank of America Merrill Lynch. StanChart’s shares are 4.43 percent better off at 756.40p.
**The FTSE 100 index was 0.85 percent down at 7,265.10 points as of 13:23 GMT on Tuesday, 17 January 2017.**