Weaker pound lifts FTSE 100 even as virus woes, Brexit uncertainty remain

Weaker pound lifts FTSE 100 even as virus woes, Brexit uncertainty remain
(Reuters) – London stocks inched higher on Friday as upbeat retail sales data, the prospect of easing coronavirus restrictions and hopes for a vaccine set the benchmark indexes on course for their third straight week of gains.

FILE PHOTO: The London Stock Exchange Group offices are seen in the City of London, Britain, December 29, 2017. REUTERS/Toby Melville

The blue-chip FTSE 100 index rose 0.5%, boosted by aero and pharmaceutical stocks, with energy and mining shares also tracking commodity prices higher.

The domestically focused mid-cap FTSE 250 added 0.2%, led by travel and leisure and retailer stocks.

Official data showed British retail sales rose a higher-than-expected 1.2% in October, ahead of the recent restrictions. A Reuters poll found Britain is on course for a double-dip recession as a result of the renewed lockdown measures.

“The question now is whether the retail sector can pull off an equally rapid rebound after this second lockdown,” ING economist James Smith said.

“The answer, we suspect, is mixed.”

Meanwhile, UK Health Secretary said Britain may allow a Christmas period with less stringent restrictions as there were signs that domestic coronavirus cases were starting to flatten as a result of the current lockdowns.

Uncertainty over Brexit negotiations has also capped gains on the FTSE 100 this week following a jump of about 13% in the past two weeks.

A senior EU diplomat told envoys in Brussels that an agreement with Britain was very close on most issues, but differences persisted over fishing rights, guarantees of fair competition and ways to solve future disputes.

Among other stock movers, Sage Group Plc tumbled 11.4% after the software firm reported a 3.7% drop in full-year organic operating profit.

British Land fell 1.1% after Barclays cut its target price on the stock.

Reporting by Devik Jain in Bengaluru, Editing by Sherry Jacob-Phillips and Sriraj Kalluvila

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