London open: Stocks fall as sterling rallies; Lloyds in focus
London stocks fell in early trade on Wednesday, underperforming their European peers as sterling rallied.
At 0920 GMT, the FTSE 100 was 0.5% lower at 6,591.42, while sterling rose 0.5% against the dollar to 1.4181, having earlier hit $1.42 for the first time since April 2018.
A stronger pound tends to dent the top-flight index as around 70% of its constituents derive most of their earnings from overseas.
Spreadex analyst Connor Campbell said: "While it failed to react much to the announcement at the start of the week, the idea that the UK could be back to ‘normal’ by the summer seems to have finally sunk in for sterling.
"All this spelled disaster for the FTSE. With its many multinational constituents uncomfortably eyeing the pound’s blockbuster performance, the index tumbled half a percent to fall the wrong side of 6,600."
In equity markets, banks - with the exception of Lloyds - were under the cosh, with HSBC, NatWest and Standard Chartered all weaker.
Dollar-earners were also under pressure, with Experian, British American Tobacco, Unilever, Imperial Brands and AstraZeneca all weaker.
Aviva lost ground as it said it was exiting its Turkish business, a day after announcing the sale of its French unit.
On the upside, Lloyds rose as it reported a 72% slump in annual profits, reflecting the impact of the Covid-19 pandemic, but reinstated dividend payments.
Consumer goods giant Reckitt Benckiser gained after the company posted a surge in full-year revenues as demand for cleaning and hygiene products spiked during the pandemic.
Housebuilders Barratt, Taylor Wimpey and Persimmon were all up amid reports the stamp duty holiday will be extended until the end of June.
Travel & leisure stocks were on the rise again amid the prospect of easing restrictions, with British Airways owner IAG, Tui, Carnival and easyJet all higher.
Tesco was boosted by an upgrade to ‘outperform’ at Credit Suisse, while Irish convenience food company Greencore rallied after an upgrade to ‘buy’ at HSBC.
Gamesys and 888 pushed higher after initiations at ‘buy’ by Jefferies.
FTSE 100 - Risers
International Consolidated Airlines Group SA (CDI) (IAG) 186.75p 2.84%
Avast (AVST) 473.00p 2.29%
Barratt Developments (BDEV) 698.60p 2.13%
Lloyds Banking Group (LLOY) 39.95p 1.86%
Taylor Wimpey (TW.) 166.65p 1.65%
Tesco (TSCO) 227.90p 1.51%
JD Sports Fashion (JD.) 860.20p 1.44%
BP (BP.) 287.20p 1.31%
Intermediate Capital Group (ICP) 1,899.00p 1.23%
Kingfisher (KGF) 269.50p 1.16%
FTSE 100 - Fallers
HSBC Holdings (HSBA) 416.25p -2.75%
Experian (EXPN) 2,325.00p -2.43%
Standard Chartered (STAN) 496.50p -2.15%
NATWEST GROUP PLC ORD 100P (NWG) 182.05p -2.02%
Associated British Foods (ABF) 2,412.00p -1.71%
British American Tobacco (BATS) 2,562.00p -1.69%
Unilever (ULVR) 3,860.00p -1.53%
Imperial Brands (IMB) 1,379.00p -1.50%
AstraZeneca (AZN) 7,029.00p -1.50%
United Utilities Group (UU.) 887.80p -1.47%
FTSE 250 - Risers
Greencore Group (GNC) 156.60p 5.81%
TUI AG Reg Shs (DI) (TUI) 420.70p 5.68%
Greggs (GRG) 2,282.00p 5.45%
Carnival (CCL) 1,558.00p 4.60%
Gamesys Group (GYS) 1,400.00p 4.48%
Workspace Group (WKP) 801.50p 4.36%
Pets at Home Group (PETS) 396.00p 4.21%
888 Holdings (888) 304.50p 3.75%
Vistry Group (VTY) 899.50p 3.33%
easyJet (EZJ) 962.60p 3.24%
FTSE 250 - Fallers
JPMorgan Japanese Inv Trust (JFJ) 673.00p -3.86%
Fidelity China Special Situations (FCSS) 425.50p -3.08%
Baillie Gifford Japan Trust (BGFD) 1,068.00p -2.38%
CLS Holdings (CLI) 215.00p -2.27%
Herald Investment Trust (HRI) 2,125.00p -2.07%
Synthomer (SYNT) 456.60p -1.81%
VinaCapital Vietnam Opportunity Fund Ltd. (VOF) 414.00p -1.78%
Genesis Emerging Markets Fund Ltd Ptg NPV (GSS) 876.00p -1.57%
Hiscox Limited (DI) (HSX) 924.20p -1.56%
Law Debenture Corp. (LWDB) 703.00p -1.54%