FTSE 100 smashes through 7,000 as investors cheer falling pound

Emma Haslett
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Rangers v Celtic
Markets have cheered the lower pound (Source: Getty)

The FTSE 100 smashed past the 7,000 mark this morning as the falling pound continued to keep investors' spirits high.

The market opened at 7,004 points, 0.28 per cent up on yesterday's closing price, before rising more than one per cent to 7,054 points in early trading.

Although the market edged towards the psychologically important milestone yesterday, it finished at 6,983 points.

Meanwhile, the FTSE 250 set a new record, edging above 18,400 points for the first time ever.

However, this morning sterling hit a 31-year low as currency traders continued to show their nerves over Prime Minister Theresa May's announcement this weekend she will trigger Article 50, which will begin the process of Brexit, by March next year.

Investor enthusiasm was partly driven by a surprisingly strong reading in the construction sector's purchasing managers' index (PMI) , which figures published this morning showed had been pushed up by in August by activity in the housebuilding sector.

That followed yesterday's PMI for the manufacturing industry, which hit its highest since June 2014 as the UK's manufacturers made the most of the weak pound.

"A weak pound is helping propel ever higher the army of international-exposed FTSE names that benefit from helpful currency conversion gains while housebuilders are enjoying the prospect of the UK chancellor’s £5bn UK housebuilding stimulus," said Mike van Dulken, head of research at Accendo Markets.

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