London’s FTSE 100 charged to a 16-month high, but fell just four points short of smashing 7,000 in intraday trade, after the pound slumped towards a three-decade low on Theresa May’s Brexit deadline.
The latest slide in the pound, which sparked renewed interest in London-listed export-driven, internationally focused companies, was prompted by Theresa May, who told her Conservative Party conference that she would invoke Article 50 no later than the end of March next year.
As the City geared up for a hard Brexit, the blue chip index began the fourth quarter in bullish fashion, closing up 84.19 points, or 1.22pc, to 6,983.52 – its highest level since May 29 2015. On Friday, London’s benchmark index recorded its best quarterly performance in three-and-a-half years, rising 6.07pc, and despite an immediate fall in the afftermath of the referendum, it is now up 10.82pc from pre-Brexit levels.
Asset managers were in demand after mid-cap Henderson Global Investors announced that it will merge with US rival Janus Capital to form a $6bn, spurring its best day in almost eight years. Shares leapt 38.7p to 270.7p. Its peers also rallied after broker Numis said it anticipated “an increasing level “an increasing level of M&A activity” sector-wide, “predicated on low industry organic growth and margin pressures”. Aberdeen rose 16.3p to 342.6p, Jupiter jumped 25.7p to 451.1p, and Schroders advanced 74p to £27.70. Separately, UBS raised Schroders price target to $29.40 from £28.40.
Insurer Legal & General found itself among the laggards, down 2.1p to 216.6p, after JP Morgan revised its target price lower to 197p as it believes it cash generation growth is set to slow down.
Oil majors also rallied after Brent crude smashed $50 a-barrel for the first time in over a month as investors began to warm to Opec’s deal to curb output. Royal Dutch Shell B shares rose 47p to £20.44 and BP added 8.4p to 458.4p.
Elsewhere, ITE Group, the Russian and Central Asian-focused exhibition and conference, warned the recent attempted coup in Turkey had significantly international travel to the region and hurt bookings on Turkishno signs of recovery in demand, Canaccord Genuity sees “ a greater impact” from Turkey on the group’s full-year results. Shares fell 5.8p to 156.8p.
On Aim, model railway maker Hornby broke 40p for the first time in eight months – jumping 1.4pc – after chief executive Steve Cooke bought 97,000 shares at 35.7p a piece, in what was his first share purchase since taking the helm in April. Nevertheless, shares are still down 55pc so far this year, after it warned on profits in February.
On that note, it’s time to finish up for today. I’ll be back again tomorrow morning with more market movers!
Royal Bank of Scotland will pay $120m to resolve a mortgage bond probe in Connecticut. Reuters has the details:
Royal Bank of Scotland Group will pay $120 million to resolve a Connecticut state investigation into the bank’s underwriting of toxic mortgage-backed securities ahead of the 2008 financial crisis, authorities said on Monday.