Fall in pound helps FTSE to post another record high
The pound dipped on Monday, helping the FTSE 100 eke out another record high after the Government revealed plans to trigger Article 50 next week.
Sterling fell more than 0.4% against the US dollar to trade near 1.234, and dropped over 0.3% versus the euro to trade at 1.149.
The FTSE 100 recorded another all-time record high thanks in part to the drop in the pound , ending the day up 0.07% or 4.85 points at 7,429.81.
Mutlinational firms on the blue chip index tend to benefit when foreign currencies are stronger than sterling.
It follows news that Theresa May will trigger the beginning of formal Brexit talks March 29.
Connor Campbell, a financial analyst at SpreadEx, said: "Having enjoyed three week highs during the morning, the spectre of Brexit came back to haunt the pound this afternoon."
The pound had risen above 1.24 against the US dollar in early trading amid investor excitement over the Consumer Price Index (CPI) measure of inflation, set to be released Tuesday.
It is expected to have exceeded the Bank of England's 2% target at 2.1% in February.
"Now the pound finds itself back in the red and below 1.24 thanks to Theresa May's confirmation that she will trigger Article 50 on March 29," Mr Campbell added.
The news was hardly a surprise - however the reminder that the UK is facing years of difficult and likely hostile trade negotiations seemed to suppress investors' appetite for the currency.
Across Europe, the French Cac and German Dax dropped by 0.34% and 0.35%, respectively.
In oil markets, Brent crude was hovering around the flatline at 51.72 US dollars per barrel (£41.89).
Investor concern over growing energy output in the US was countered by reports suggesting Opec was considering extending production cuts into the second half of the year.
In UK stocks, Vodafone shares dropped 0.9p to 210.5p after announcing plans to merge its Indian operation with Idea Cellular in a deal that will create the Asian country's biggest telecoms firm.
Vodafone said there would be "substantial" cost savings to be made off the back of the deal, estimated to be around 10 billion US dollars (£8 billion)
Lloyds Banking Group shares were flat at around 69.3p, following news that it has recruited Professor Russel Griggs to spearhead an investigation into whether it should compensate customers who became victims of fraud at the hands of former HBOS staff.
It comes after a group of corrupt financiers were jailed for carrying out a £245 million loans scam and squandering the profits on high-end prostitutes and luxury holidays.
A FTSE Russell EMEA Committee decision to relegate Dixons Carphone and Capita shares from the blue chip index came into effect today, pushing those two stocks into the FTSE 250.
Companies listed on the UK stock market are reviewed four times a year and reshuffled among the indexes based on their market capitalisation, a measurement derived from a firm's share price.
The biggest risers on the FTSE 100 were 3i Group up 14p to 735p, Direct Line Insurance Group up 6.5p to 340.9p, Admiral Group up 34p to 1,979p, and Sainsbury up 4.7p to 274.4p.
The biggest fallers on the FTSE 100 were Royal Bank of Scotland down 4p to 239.9p, Hikma Pharmaceuticals down 33p to 2,135p, Smurfit Kappa Group down 26p to 2,206p, and Anglo American down 14.5p to 1,278p.