The FTSE 100 index ended very slightly up by 0.09% at 7,287.4 and the FTSE 250 index up by 1.19% at 18,629.6 thanks to gains in commodity stocks, as Liz Truss was finally named British Prime Minister after a long leadership battle in the Conservative party, and promised to immediately announce a financial package to deal with the energy crisis.
The pound fell to $1.1443 before recovering slightly by lunchtime Monday, according to FactSet figures quoted by the Wall Street Journal.
In recent weeks, the pound has lost as much as 15% against the dollar amid fears over Britain’s surging inflation and stalling growth.
Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown in London said, “The pound would have lifted higher had Rishi Sunak won as he was more committed to getting a hold on inflation, while Truss is prioritising tax cuts.”
“That’s why you’ve seen such nervousness, particularly in the currency markets, because of worries about what damage this could do to the long-term stability of the UK.”
Energy giants including Shell (GB:SHEL) gained as oil prices surged following news that OPEC and other nations are cut oil production by 100,000 barrels a day from next month.
Chris Beauchamp, chief market analyst at online trading platform IG, commented: “OPEC’s talk of a modest cut to production has provided the spark for another bounce in oil prices.”
Aston Martin Lagonda’s (GB:AML) stocks fell by 16.5% as it announced a discount on a £576 million rights issue, in an effort to reduce debt and finance new electric vehicles.
British business news today
The bad news for the pound is not all in the price (FT)
JP Morgan moves work to London from Germany amid blackout fears (Telegraph)
Truss plans energy bill freeze amid fear of wave of bankruptcies (Times)
