FTSE 100 exporters lose momentum after Brexit delay lifts pound
Top UK stocks saw their four-day rally broken on Wednesday after news of another Brexit extension saw the pound find support.
The FTSE 100 had the wind knocked out of its sails on Wednesday, with the Britain’s top stocks breaking a four-day winning streak after another Brexit extension helped the pound rally.
The exporter heavy FTSE 100 slid by 0.1% on Wednesday morning, while the more domestic-focused FTSE 250 index recorded a 0.3% gain, driven by the uptick in the pound.
Theresa May seeks another Brexit extension
The British Prime Minister Theresa May announced on Tuesday evening that she will seek another Brexit extension from leaders in Brussels beyond April 12.
May plans to use the extra time to try and hash out a deal with the support of Labour leader Jeremy Corbyn in the hope of drafting a withdrawal agreement capable of gaining enough cross-party support to get it passed after her own deal was defeated for the third time last week.
If they are unsuccessful, there is still a chance that Britain could bail out of the bloc without a deal but talks between May and Corbyn offer hope that the UK will continue to have a close economic relationship with the EU after Brexit.
Homebuilders stocks rally, while exporters hurt by sterling’s surge
News of another delay and the renewed hopes of a softer Brexit helped boost shares in housebuilders like Taylor Wimpey, Persimmon and Barratt Developments edged higher, with the trio seeing their stocks rally between 2%-3% on Wednesday.
However, major UK exporters were hit by a stronger sterling, with British American Tobacco, spirits maker Diageo, GlaxoSmithKline and Unilever driving the FTSE 100 lower, with them all falling by 1%-2%.
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