Britain’s index of major companies got a boost from a weaker pound, which fell after Bank of England governor Mark Carney said now was not the time to raise interest rates. Sterling hit a one-week low after Mark Carney dashed prospects of an early rise in borrowing costs after three BoE members surprised markets by voting for a hike last week. The sterling effect turned the FTSE around from a lacklustre start of trading, with some weak company updates weighing. The index was up 0.2 percent by 0920 GMT.
The prospect of lower rates for longer boosted housebuilders Persimmon and Taylor Wimpey, which were among the top FTSE gainers. Shares in plumbing and heating supplier Wolseley fell 3.4 percent after its quarterly results. The firm saw sales growth in all its regions except the UK, adding to signs that Britons are cutting back on big ticket spending. Analysts at Liberum and Davy Research said eroding margins in its U.S. business were disappointing.
BT fell up to 1.6 percent, then paring losses after France’s Orange said it could get $1.15 billion by cutting its stake in the British telecoms company. A downgrade to ‘neutral’ from BAML on Monday also weighed. Antofagasta, Glencore, BHP Billiton and Rio Tinto reined blue-chips back, falling on lower copper and iron ore prices.
Barclays was in focus after the bank and four former senior executives were criminally charged over undisclosed payments to Qatari investors during a 12 billion pound emergency fundraising in 2008. The announcement, which had been anticipated, left Barclays shares down 0.3 percent.
Domino’s Pizza fell 5.1 percent to a 16-month low after Investec initiated coverage of the company with a ‘sell’. Workspace provider IWG was set for its worst day in a year after Estorn Limited placed 27 million shares in the company for sale at 345.1 pence per share. Despite the losses from IWG and Domino’s, mid-caps rose 0.2 percent gain, with Serco up 2.9 percent after winning a $2 billion contract to run an Australian prison.
Consumer, financial and tech stocks were the main drivers for the FTSE 250 index which, having suffered heavy losses on Thursday, was climbing back up to near record highs on Tuesday. Among small caps, plus-size clothes retailer N Brown jumped 12 percent to a 14-month high after a strong start to the year with first-quarter revenue up 10 percent and loss-making store closures pleasing investors.