FTSE 100 inches higher ahead of Fed update and election
The London markets were extremely cautious as traders were on tenterhooks ahead of the latest Federal Reserve statement and Thursday’s General Election.
The FTSE 100 was unusually muted at the close of play, edging marginally higher, while the pound rebounded from an early dip after polling suggested a Conservative election win would be slender.
London’s top flight closed 2.49 points lower at 7,216.25 at the end of trading on Wednesday.
The other major European markets also moved modestly higher driven by caution over the Fed statement and optimism over global trade tensions.
David Madden, market analyst at CMC Markets UK, said: “Equity markets in Europe are showing small gains, the US-China trade situation is still at the forefront of traders’ minds.
“The Sunday deadline in relation to the US tariffs on 150 billion dollars-worth of Chinese imports is looming, and the lack of clarity has brought about low volatility in stocks.”
The German Dax increased by 0.63% while the French Cac edged 0.27% higher.
Across the Atlantic, the Dow Jones opened slightly lower as traders wait on the Fed’s interest rate decision later on Wednesday, although the central bank is not expected to move interest rates.
Meanwhile, sterling was broadly flat after a positive period for the currency, nudging slightly higher against the dollar as traders continued to bank on a Conservative election victory.
Connor Campbell, financial analyst at Spreadex, said: “Plunging as much as 0.7% this morning as the final MRP model suggested the Tories will end up with a slender majority of 28, the pound collected itself somewhat as the day went on.”
The value of the pound increased 0.04% versus the US dollar at 1.317 and dipped 0.01% against the euro at 1.187.
In company news, JD Sports was firmly at the foot of the FTSE 100 after the retailer’s shares dived on the back of a £177 million share sale by its largest investor.
Majority owner Pentland Group which also owns sportswear brands such as Speedo and Berghaus, said it sold 24 million shares in the company at 740p each.
Shares in the firm thus plunged by 76.4p to 727p at the end of trading.
Elsewhere, Stagecoach leapt higher after its brother-and-sister founders said they would step back as part of a leadership shake up.
Sir Brian Souter will step down as chairman but stay on the board, while Dame Ann Gloag will retire from the board completely, the company announced. Shares in the business increased by 11.2p to 136.8p on Wednesday.
Saga shares dipped after the over-50s insurer announced the appointment of former Superdry boss Euan Sutherland is its next chief executive.
The troubled firm saw shares close 0.78p lower at 46.58p.
The price of oil sold off sharply, sliding into the red on the back of the latest Energy Information Administration report which showed stockpiles were below expectations.
The price of a barrel of Brent crude oil fell by 1.15% to 63.44 US dollars.
The biggest risers on the FTSE 100 were Fresnillo, up 27.2p at 581.6p, Ashtead, up 94p at 2,314p Pearson, up 11.8p at 645p, and Hikma, up 33p at 1,976p.
The biggest fallers on the index were JD Sports, down 76.4p at 727p, Auto Trader, down 16.6p at 537.4p, RSA, down 14.2p at 531p, and Evraz, down 8.2p at 353.4p.