Breaking News
Black Friday SALE: Up to 54% off InvestingPro! Register here
Investing Pro 0
Ad-Free Version. Upgrade your experience. Save up to 40% More details

London's blue chip stocks fall as pound weighs after Brexit vote defeat

Stock MarketsJan 16, 2019 04:10AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters. The London Stock Exchange Group offices are seen in the City of London, Britain

By Josephine Mason

LONDON (Reuters) - Britain's blue chip stocks were lower in early deals as the stronger pound pushed multinationals lower after Prime Minister Theresa May's deal to leave the European Union suffered an overwhelming defeat and weak results from Pearson weighed.

The top share index (FTSE) was down 0.1 percent at 0848 GMT, lagging European peers as the sterling hit its highest since November, a day after British lawmakers overwhelmingly defeated May's Brexit divorce deal.

The prime minister's historic loss was seen as reducing the chance of a hard Brexit even as uncertainty ahead of a no confidence vote in May's government on Wednesday evening kept trading muted.

Consumer staples which earn their revenue abroad in foreign currency accounted for the biggest drop, with oil and gas (FTNMX0530) down 0.5 percent. Blue-chip stocks generate 70 percent of their income overseas.

The domestically focused midcaps (FTMC), which make half of their income at home, were up 0.4 percent. Ireland's top share index (ISEQ), one of the barometers for Brexit sentiment, was up 0.5 percent.

A hard exit is "a lower probability risk than it was, but I don't think we can completely discount it. The market isn't completely discounting it," said Caroline Simmons, deputy head of the UK investment office of UBS Global Wealth Management.

Housebuilders, seen to be most at risk from a weaker UK economy amid Brexit uncertainty, led the gainers after Bovis Homes (L:BVS) forecast better-than-expected full year profits.

Persimmon (L:PSN), Taylor Wimpey (L:TW), Barratt (L:BDEV) and Berkeley Group (L:BKGH) were all up between 2.2 and 2.5 percent. Midcap Bovis was up 3.6 percent.

"The potential for a softer Brexit outcome may neutralize any negative impact of higher uncertainty and the vote of no confidence," said Kallum Pickering, senior economist at Berenberg.

In corporate moves, Pearson (L:PSON) topped the fallers after its full-year outlook. The company's forecast for full-year profits was in line with expectations, but pointed to weaker-than-expected revenues.

Liberum analysts said the guidance was possible only due to a massive savings drive.

Investors shunned Reckitt Benckiser (L:RB) after it announced its chairman was retiring after more than 30 years at the firm. He is considered an architect of the company's push to become a global consumer health products company.

London's blue chip stocks fall as pound weighs after Brexit vote defeat

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email