FTSE 100 loses ground as exporters slip, Rolls-Royce tumbles

The London Stock Exchange Group offices are seen in the City of London December 29, 2017. — Reuters pic
The London Stock Exchange Group offices are seen in the City of London December 29, 2017. — Reuters pic

LONDON, Sept 20 — Britain’s top share index edged lower today as exporter stocks weakened on the back of gains in sterling driven by rising hopes of a Brexit deal, while Rolls-Royce tumbled after delays to repairs of its Trent 1000 engines.

The FTSE 100 was down 0.3 per cent by 0815 GMT, while the domestically focused FTSE 250 index was 0.4 per cent higher as it tracked gains in the local currency.

Hopes Britain could yet strike a deal to exit the European Union after European Commission President Jean-Claude Juncker said yesterday one was possible helped the pound extend overnight gains versus the dollar to a two-month high.

Dollar earners such as British American Tobacco, Unilever and HSBC weighed on the main index.

BAT also fell on a Dutch media report on tax liabilities and worries over stricter regulatory clampdowns in the United States, according to traders.

Rolls-Royce tumbled 3.6 per cent after the engine-maker said it expects problems with its Trent 1000 engines to take longer than expected to fix.

However, housebuilders, which are sensitive to an economic impact of a no-deal Brexit, cushioned losses on the main index.

Blue-chips Persimmon, Barratt Development and Taylor Wimpey added between 3.5 per cent and 4.5 per cent.

Still, the main bourse is set to end the week in negative territory after three straight weekly gains.

“It’s not shaping up to be the most thrilling session, in what has turned into a rather damp-squib second half of the week, the markets struggling for direction following the Fed’s mixed bag statement on Wednesday evening,” Spreadex analyst Connor Campbell said.

Mid-cap Investec gave up 5.8 per cent after the investment bank warned of lower profit in the first half as it grapples with higher restructuring costs and “challenging” market conditions.

Investec shares were headed for their worst day this year.

Thomas Cook plunged 20 per cent to a new all-time low after the travel firm said an extra £200 million (RM1.04 billion) had been requested by stakeholders in talks to finalise the restructuring plan to save the company.

Keller Group shed 5.4 per cent after the engineering contractor flagged that trading in North America in the second half of the year has started “more slowly than previously expected”.

Royal Bank of Scotland climbed 2 per cent. The bank appointed Alison Rose as its new chief executive, becoming the first major British lender to appoint a woman to its top job. — Reuters

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