FTSE down despite boost from RBS profit 'milestone'
Shares in Royal Bank of Scotland soared on Friday after the embattled lender booked its first quarterly profit since 2015 in what chief executive Ross McEwan described as a "major milestone".
The taxpayer-backed bank rose more than 4%, or 12p, to 265.4p as it recorded a better-than-expected £259 million profit in the first three months of the year, compared with a £968 million loss in the same quarter last year.
However, the wider FTSE 100 Index struggled for momentum as the strength of the pound caused the top-flight to close down 33.23 points at 7,203.94.
Multi-national stocks struggle on the London market when the UK currency rises as it diminishes the value of their overseas earnings when translating them back into pounds.
The market fell as sterling edged closer to the psychologically important 1.30 mark versus the US dollar, rising 0.3% to 1.294, despite worse-than-expected economic growth in the first quarter.
The pound shrugged off the latest update from the Office for National Statistics (ONS) which showed gross domestic product (GDP) grew by 0.3% in its initial estimate for the first quarter of 2017, down from 0.7% in the fourth quarter of last year.
Economists had been expecting GDP growth to slow as consumers tightened their belts in the face of rising inflation, but they had pencilled in a higher growth figure of 0.4%.
The ONS said: ''There were falls in several important consumer-focused industries, such as retail sales and accommodation; this was due in part to prices increasing more than spending.''
Britain's powerhouse services sector, which accounts for 78% of the UK economy, put downward pressure on overall growth after expanding by 0.3% between January and March this year, slowing from 0.8% between October and December of 2016.
The UK currency was marginally ahead against the euro at 1.18.
Across Europe, Germany's Dax and the Cac 40 in France both slipped by 0.1%, while US stock markets were on the back foot as the FTSE 100 Index closed.
On the oil markets, Brent crude pushed 0.4% higher to 52 US dollars (£40) a barrel as traders were encouraged that Opec will extend output controls when it meets next month.
In UK stocks, Barclays endured a torrid time as investors took a dim view of the lender's first quarter results.
The banking giant said group pre-tax profit surged to £1.68 billion in the three months to March 31, up from £793 million during the same period last year.
However, the firm sunk in excess of 5%, or 11.7p, to 212.3p in response to a 4% drop in income from its investment banking markets division to £1.35 billion.
Chief executive Jes Staley said the bank has nearly completed its overhaul, with only three more businesses to exit in Egypt, Zimbabwe and France.
The biggest risers on the FTSE 100 Index were Royal Bank of Scotland up 12p to 265.4p, Antofagasta up 19.5p to 838p, Morrisons up 5.5p to 239.9p, International Consolidated Airlines Group up 11.5p to 560p.
The biggest fallers on the FTSE 100 Index were Barclays down 11.7p to 212.3p, Mediclinic International down 38p to 821p, Royal Mail down 16.4p to 402.5p, Standard Chartered down 20.1p to 721.2p.