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Pound hits post-Brexit low against euro amid housing market 'wobble'

Published 11/08/2016

London's top-flight index closed above 6,900 for the first time in more than 14 months
London's top-flight index closed above 6,900 for the first time in more than 14 months

The pound has dived to a post-Brexit low against the euro following a housing market "wobble" in the wake of the EU referendum result.

Sterling dropped to 1.159 euro - its lowest level since 2013 - after a survey by the Royal Institution of Chartered Surveyors (Rics) revealed house price growth in July dropped to its weakest level in three years.

It later recovered to a 0.2% fall to 1.160 euro, while sterling dropped to a one-month low against the dollar before easing to a 0.4% fall at 1.295 US dollars.

But London's top-flight index closed above 6,900 for the first time in more than 14 months, stepping up 48.29 points to 6,914.71.

The market was pushed higher after tour operator TUI said there had been no slowdown in UK bookings as a result of the EU referendum result.

Shares were up nearly 3% or 29p to 1041p as Europe's biggest tour operator said UK revenue and bookings were up 6% in the third quarter.

It said: "There has been no apparent slowdown in bookings as a result of the EU referendum, demonstrating once again the resilience of demand for our unique and differentiated holidays."

Across the group, revenue was down 5.7% as a decline in bookings to north Africa and Turkey and the impact of terrorist attacks across Europe took their toll.

Oil majors were back in the black after a fall in the previous session thanks to a surge from Brent crude.

The price of oil jumped 3.4% or one dollar and 49 cents to 45.54 US dollars after Saudi energy minister Khalid al-Falih said Opec members and non-members could begin talks over possible action to stabilise prices.

Royal Dutch Shell was up 20.5p to 1005p and BP climbed 9.3p to 432.3p.

Across Europe, Germany's Dax was up 0.8% and the Cac 40 in France rose 1.2%.

In UK stocks, housebuilders took a tumble after the Rics report showed s ales continued to decline sharply in July. Across the UK, a net balance of 34% of surveyors reported a fall in house sales rather than an increase.

Berkeley Group was down 98p to 2515p and Taylor Wimpey fell 1.1p to 152.7p.

Away from the top tier, sofa chain DFS was the biggest riser on the FTSE 250 after upping its earnings outlook following a record full-year performance, but warned over darkening gloom following the Brexit vote.

The Doncaster-based group said while it had not yet seen any drop in demand since the decision to quit the EU, there was an "increased risk of a market slowdown" for furniture firms.

Shares soared more than 15% or 34.9p to 258.9p.

Cineworld was down 8.5p to 585p as adverse currency movements saw profits take a dive in the first half of the year.

The company said pre-tax profits fell 34.6% to £30.6 million after currency fluctuations cost it £6.1 million.

However, a slate that included The Jungle Book, Deadpool and Captain America: Civil War helped revenue rise 8.4% to £356.7 million.

The biggest risers on the FTSE 100 Index were Coca-Cola HBC up 110p to 1681p, TUI up 29p to 1041p, Intertek Group up 96p to 3663p, British American Tobacco up 126.5p to 4985p.

The biggest fallers were Direct Line Insurance down 16p to 377p, Old Mutual down 8.6p to 216.9p, Berkeley Group down 98p to 2515p and BT Group down 9.1p to 399.3p.

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