London open: Stocks edge up as pound loses ground on Brexit news

London stocks edged higher in early trade, helped along by weakness in the pound, which fell after Brexit Secretary David Davis warned that Britain will walk out of Brexit talks if the EU demands €100bn to leave.

At 0840 BST, the FTSE 100 was up 0.4% to 7,497.78, while the pound was down 0.4% against the dollar at 1.2972 and 0.1% versus the euro at 1.1613.

Spreadex analyst Connor Campbell said: “The difference in the pound’s performance against the two currencies is illustrative, suggesting that, despite the snap election boost, its recent gains against the greenback are more a case of Trump-inspired weakness than sterling-strength.”

A weaker sterling tends to benefit the FTSE 100, as around 70% of its constituents derive their earnings from overseas.

Davis said over the weekend that Britain would not engage in talks unless Brussels drops its demand to charge €100bn to leave the EU.

Meanwhile, oil prices were on the rise ahead of an OPEC meeting in Vienna on Thursday during which members will discuss the possible extension of their agreement to cut production by 1.8m barrels a day until mid-2017. West Texas Intermediate was up 0.8% to $51.09 a barrel and Brent crude was 0.7% higher at $54.01.

Investors were also likely to be keeping an eye on any headlines related to Trump’s inaugural trip abroad, after he signed a $110bn arms deal with Saudi Arabia.

In corporate news, AstraZeneca nudged up after announcing the sale of its European rights to a hypertension and angina treatment for a sum of $300m plus royalties and a percentage of sales.

Wood Group edged higher after saying it has signed a technical support services contract with Sakhalin Energy Investment Company, an operator of Sakhalin-2, one of the world’s largest integrated oil and gas projects, for an undisclosed sum.

Shares in Vectura fell after the inhaler maker said it is due to present positive outcomes of its Phase I clinical study on its VR942 inhaled asthma treatment at the American Thoracic Society’s annual conference later on Monday.

Intertek was boosted by an upgrade to ‘buy’ at Kepler Cheuvreux and Cairn Energy was lifted by an upgrade to ‘outperform’ at Macquarie, but Micro Focus took a hit after Credit Suisse cut the stock to ‘underperform’.

There are no major UK data releases due.

Market Movers

FTSE 100 (UKX) 7,497.78 0.36%
FTSE 250 (MCX) 19,861.75 0.25%
techMARK (TASX) 3,599.62 0.24%

FTSE 100 - Risers

Intertek Group (ITRK) 4,247.00p 1.92%
Anglo American (AAL) 1,111.00p 1.65%
Marks & Spencer Group (MKS) 389.60p 1.22%
Fresnillo (FRES) 1,615.00p 1.06%
Randgold Resources Ltd. (RRS) 7,385.00p 1.03%
3i Group (III) 837.00p 1.03%
Antofagasta (ANTO) 816.50p 0.93%
Land Securities Group (LAND) 1,078.00p 0.84%
Vodafone Group (VOD) 222.15p 0.84%
Standard Chartered (STAN) 742.00p 0.82%

FTSE 100 - Fallers

Micro Focus International (MCRO) 2,414.00p -2.35%
Bunzl (BNZL) 2,414.00p -1.79%
Worldpay Group (WPG) 317.90p -1.24%
Royal Mail (RMG) 423.30p -1.19%
Direct Line Insurance Group (DLG) 349.30p -0.68%
Rolls-Royce Holdings (RR.) 846.50p -0.53%
DCC (DCC) 7,415.00p -0.47%
Morrison (Wm) Supermarkets (MRW) 241.70p -0.33%
Persimmon (PSN) 2,423.00p -0.33%
Hikma Pharmaceuticals (HIK) 1,731.00p -0.29%

FTSE 250 - Risers

Cairn Energy (CNE) 218.60p 3.50%
Nostrum Oil & Gas (NOG) 500.00p 2.04%
Bankers Inv Trust (BNKR) 794.00p 1.93%
Elementis (ELM) 295.20p 1.90%
ZPG Plc (ZPG) 363.30p 1.76%
Tullow Oil (TLW) 214.10p 1.71%
Just Group (JUST) 137.40p 1.70%
Grainger (GRI) 262.50p 1.67%
Acacia Mining (ACA) 438.00p 1.65%
Fidelity European Values (FEV) 218.50p 1.63%

FTSE 250 - Fallers

Paysafe Group (PAYS) 465.80p -3.60%
Sophos Group (SOPH) 391.30p -2.30%
Millennium & Copthorne Hotels (MLC) 463.60p -1.74%
AO World (AO.) 147.90p -1.20%
Wetherspoon (J.D.) (JDW) 1,002.00p -1.18%
Just Eat (JE.) 600.50p -1.15%
Indivior (INDV) 320.30p -0.84%
CYBG (CYBG) 272.30p -0.77%
Petrofac Ltd. (PFC) 650.50p -0.76%
Euromoney Institutional Investor (ERM) 1,171.00p -0.76%