Soaring pound dents internationally-focused FTSE

The blue-chip FTSE 100 closed the day down as its internationally-focused constituents struggled under the weight of the pound soaring to levels not seen since February.

Traders were enjoying the confirmation that lockdown restrictions in England would be eased from May 17 and the economic benefit it will bring, helping to push sterling up.

But with so many shares in FTSE 100 companies bought and sold in the US currency, the prices appeared expensive, helping the index close the day down 6.03 points, or 0.08% at 7123.68.

By comparison, as markets closed a pound was worth 1.415 dollars – up 1.06% on the day – and up 1% against the euro at 1.162.

Connor Campbell, financial analyst at Spreadex, explained: “A couple of key things have gone the pound’s way in the last few days. Firstly, the SNP failed to gain an absolute majority in the Scottish elections, making more difficult the push for a second referendum on independence.

“As an extra sweetener on Monday morning, reports stated that the UK government would be going ahead with the next phase of its lockdown-easing plans despite the threat of the Indian covid-19 variants.

“These twin factors allowed the pound to make strides against the dollar and the euro, though left the currency in differing positions against both its rivals.”

The German Dax and French Cac closed flat.

In company news, sausage roll specialist Greggs said it expected to get back to normal profits this year, as the business performed well during the first few weeks after non-essential retailers reopened.

Shareholders welcomed the news, sending shares up 246p, or 10.5%, to 2,591p.

There was similar good news for high street retailer Hotel Chocolat, which said Easter had been stronger than anticipated, and profits will now be significantly ahead of expectations.

Boss Angus Thirlwell said there had been an “Easter of generosity”, with shareholders reacting with their own boost, sending shares up 35p, or 10%, to 385p.

British Gas’s owner, Centrica, held its annual general meeting on Monday, where bosses revealed they expect to save £100 million in operating costs this year after nearly all of its staff accepted new contracts.

Unions had complained about the deal, which they said will cut pay by 15% for some workers. Shares closed down 1.14p at 56.72p.

Subprime lender Provident Financial announced it has quit doorstep lending after 141 years due to “changing industry and regulatory dynamics” alongside “shifting customer preferences”.

Bosses said they would focus on its profitable Vanquis Bank credit card division and Moneybarn car finance business but not before spending £100 million on winding down or selling off the doorstep lending business. Shares fell 6.4p to 251.8p.

The biggest risers on the FTSE 100 were Berkeley Group up 147p at 4,897p; Lloyds Banking Group up 1.295p at 47.85p; Rolls-Royce up 2.94p at 109.68p; Glencore up 8.5p at 331.25p and Barclays up 3.92p at 185.46p.

The biggest fallers were Scottish Mortgages down 75.5p at 1,139.5p; Flutter down 585p at 14,040p; Just Eat Takeaway down 237p at 6,874p; Intertek down 206p at 5,984p and Whitbread down 104p at 3,188p.