FTSE 100 finishes flat as the pound edges higher

Emma Haslett
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Oil Trades Near Record Highs
The pound bounced back in trading today (Source: Getty)

The UK's bluechip index shied away from another record finish today, while the pound edged higher after a day of wild lurches as various politicians waded into the Brexit debate.

The FTSE 100 finished at 7,535 points, 0.3 per cent lower, as sterling strengthened following a sharp fall yesterday.

The index was pushed lower by engineering group GKN, whose shares were down 9.8 per cent at 318p after it brought a trading statement forward to warn on profits. Rival Smurfit Kappa was also dragged lower, finishing 1.9 per cent down at 1.9p.

Meanwhile, the FTSE 250 finished flat, at to 20,275 points. It was pushed up by Aldermore, which today confirmed rumours of a takeover offer, driving its shares 18.9 per cent higher to 303.5p.

Having taken a dive after Brexit negotiators admitted to being in deadlock yesterday, the pound bounced back against both the dollar and the euro: it was 0.3 per cent higher against the dollar at $1.3299 as the equities market closed in London, and 0.2 per cent higher against the euro, at €1.1237.

That was after it jumped as high as €1.1264 against the euro, and fell as low as €1.1211, after Theresa May gave her backing to Philip Hammond following calls for him to be sacked - while Hammond himself hit back at critics, describing accusations he is "running down the UK's economy" as "bizarre".

"The month so far has been far quieter for the pound than September but the past 24 hours have seen signs that heightened volatility could be set to return," said David Cheetham, chief market analyst at XTB.

"Talk of a 'deadlock' following the conclusion of the latest round of Brexit negotiations saw a quick swoon lower in sterling before a swift reversal occurred amidst rumours that the EU may be willing to extend an olive branch to the UK in the form of accepting a transitional period beyond the current March 2019 deadline.

"The market is highly sensitive to these rumours and counter-rumours at present. Despite these short term fluctuations the pound remains not far from its highest levels of the year and is also higher against all its major peers over the past week, but there remains a high degree of susceptibility to drops on any adverse political developments."

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