London close: FTSE ends down after Queen's Speech, Haldane's rate-rise comments

Shares in London were under pressure Thursday as sterling zipped ahead on news Bank of England chief economist Andy Haldane said he would likely vote for a rate rise later in 2017.

His apparently hawkish comments came after the central bank's governor, Mark Carney, yesterday said he wanted to see how the economy coped with Brexit talks before considering a rate rise.

Last week, the BoE's policymakers voted 5-3 to keep interest rates unchanged, a more hawkish ballot split than the market had expected.

"Were it not for Andy Haldane, the FTSE 100 may have managed to end the day in positive territory," said IG chief market analyst Chris Beauchamp.

"Haldane is one of the internal members of the Monetary Policy Committee, and so his conversion from dove to hawk sent the pound flying higher, on expectations that others on the committee will follow his lead."

The FTSE 100 closed down 0.33% or 24.92 points to 7,447.79, and the FTSE 250 by 0.45% or 89.10 points to 19,682.61. A marked rise in sterling after Haldane's comments kept the downward pressure on equities.

European stocks indices were also lower, but Wall St was mixed in its early deals.

David Madden, market analyst at CMC Markets UK, said the FTSE 100 was firmly in the red.

"Stocks in Europe are offside today as investors are still a bit wary about the large drop in oil over the past couple of weeks," he said.

All this followed the Queen's Speech earlier in the session, which was mostly focused on Brexit, immigration, customs, trade, counter-terrorism and infrastructure.

"From a trading point of view, the Queens speech didn't have a whole lot to offer," said Madden.

Connor Campbell, financial analyst at Spreadex, said the speech was "a bit of a damp squib" and had failed to ruffle the market's features.

"Investors were rescued from boredom by a rather surprising address by Andy Haldane," he said.

Meanwhile, this morning the Office for National Statistics confirmed UK public borrowing fell more than expected in May, providing encouraging reading for Chancellor Philip Hammond.

In corporate news, shares in Provident Financial tanked after it cautioned its consumer credit division would see profits nearly halve in 2017 compared to a year ago, mostly due to restructuring.

Insurers Direct Line, Admiral and Prudential were all in the red after the Queen's Speech included legislation aiming to reduce motor insurance premiums.

Whitbread was the standout gainer as it booked in a strong start to its new financial year, with revenues at its Premier Inn hotels accelerating and Costa coffee shops sales returning to like-for-like growth.

Centrica was also on the front foot after it agreed to sell its operational Langage and South Humber Park combined cycle gas turbine power stations to EP UK Investments for £318m in cash.

Biopharmaceutical company Shire rose after saying the US FDA had approved Mydayis as a once-daily treatment for patients 13 years and older with attention deficit hyperactivity disorder.

Wolseley rose after it was lifted to 'buy' from 'hold' by Canaccord Genuity. "We believe that the medium term outlook in the US continues to look very appealing and Wolseley is strongly positioned in that market," it said.

Market Movers

FTSE 100 (UKX) 7,447.79 -0.33%
FTSE 250 (MCX) 19,682.61 -0.45%
techMARK (TASX) 3,613.40 -0.04%

FTSE 100 - Risers

Whitbread (WTB) 3,984.00p 3.40%
Centrica (CNA) 206.40p 2.13%
Shire Plc (SHP) 4,460.00p 2.05%
International Consolidated Airlines Group SA (CDI) (IAG) 602.50p 1.95%
Glencore (GLEN) 281.45p 1.75%
Anglo American (AAL) 975.70p 1.70%
Fresnillo (FRES) 1,548.00p 1.57%
ITV (ITV) 178.50p 1.54%
Smurfit Kappa Group (SKG) 2,406.00p 1.48%
Antofagasta (ANTO) 765.50p 1.32%

FTSE 100 - Fallers

Provident Financial (PFG) 2,361.00p -17.59%
Hargreaves Lansdown (HL.) 1,329.00p -2.42%
St James's Place (STJ) 1,205.00p -1.79%
Standard Life (SL.) 393.20p -1.56%
Reckitt Benckiser Group (RB.) 7,878.00p -1.48%
SEGRO (SGRO) 497.40p -1.41%
Royal Dutch Shell 'B' (RDSB) 2,097.00p -1.34%
Standard Chartered (STAN) 745.30p -1.33%
Johnson Matthey (JMAT) 3,002.00p -1.31%
Admiral Group (ADM) 2,039.00p -1.31%

FTSE 250 - Risers

Capita (CPI) 696.00p 3.80%
Assura (AGR) 64.00p 3.73%
Ferrexpo (FXPO) 184.90p 3.24%
Kaz Minerals (KAZ) 479.60p 3.14%
St. Modwen Properties (SMP) 362.50p 3.10%
Just Group (JUST) 130.10p 3.09%
Acacia Mining (ACA) 298.80p 2.72%
Clarkson (CKN) 2,607.00p 2.67%
Berkeley Group Holdings (The) (BKG) 3,294.00p 2.08%
Nostrum Oil & Gas (NOG) 478.10p 1.83%

FTSE 250 - Fallers

CLS Holdings (CLI) 203.60p -5.35%
Ascential (ASCL) 321.00p -4.46%
RPC Group (RPC) 736.00p -3.73%
Pets at Home Group (PETS) 156.80p -3.39%
NMC Health (NMC) 2,275.00p -3.27%
Daejan Holdings (DJAN) 6,460.00p -3.01%
Euromoney Institutional Investor (ERM) 1,127.00p -2.94%
Genus (GNS) 1,865.00p -2.92%
Cairn Energy (CNE) 172.50p -2.82%
Grafton Group Units (GFTU) 726.00p -2.81%