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FTSE 100 Index nears record territory as pound suffers against dollar


The FTSE 100 Index closed up 10.79 points at 7,542.73

The FTSE 100 Index closed up 10.79 points at 7,542.73

The FTSE 100 Index closed up 10.79 points at 7,542.73

The pound slipped further against the US dollar on Tuesday, lifting blue-chip stocks and pushing the London market towards record territory.

Sterling dropped back below the 1.30 US dollar mark, sinking 0.5% versus the greenback at 1.297.

It came after the American currency climbed following the nation's job openings and labour turnover summary (JOLTS) report reaching a record high.

In a contrast of fortunes, the FTSE 100 Index closed up 10.79 points at 7,542.73, bringing it within a whisker of the all-time record high of 7547.63 recorded on May 26 and June 2.

Top-flight stocks, which report in US dollars or euros, get a boost on the FTSE 100 Index when the pound falls because their earnings benefit from a more favourable currency translation.

Despite slumping against the US dollar, the pound was marginally up against the euro at 1.105.

David Madden, market analyst at CMC Markets, said: "European equity markets had an uneventful morning but the sell-off in the pound and the euro prompted some buying in the afternoon.

"The jump higher in the US dollar, on the back of strong job opening figures, gave a reason for dealers to go long on the greenback, and in turn sell sterling and the single currency."

Across Europe, Germany's Dax was up 0.3% and the Cac 40 in France was 0.2% higher.

On the oil markets, Brent crude rose 0.1% to 52.41 US dollars a barrel amid reports that Saudi Arabia plans to trim oil exports to Asia by 10% come September.

In UK stocks, betting giant Paddy Power Betfair admitted it had been knocked by the lack of a major football tournament and punter-friendly sports results.

The bookmaker, which disclosed on Monday that chief executive Breon Corcoran is to step down after 16 years, reported revenue growth of 9% to £827 million.

Earnings in the six months to June 30 rose 21% to £220 million, but the firm said that, despite strong first-quarter growth helped by favourable Cheltenham results, the following three months were "affected by the absence of a major football tournament and adverse sports results".

Shares were down 310p to 7,240p.

Insurance giant Standard Life also edged lower after it revealed that investors had pulled out £3.7 billion from its funds in the first half.

Shares were off 1.2p at 442.1p after its flagship Global Absolute Return Strategies Fund took a big hit, with net outflows of £5.6 billion.

Despite this, Standard Life notched up a 6% rise in overall pre-tax operating profits to £362 million for the six months to June 30.

UK payments processor Worldpay was enjoying a strong session after being granted the second extension for its merger talks with US suitor Vantiv as the firms haggle over terms of the £9 billion deal.

The last-minute extension sees Vantiv given until 5pm on August 11 to make a firm offer or walk away under City takeover rules.

Shares were up 7p to 383.6p

The biggest risers on the FTSE 100 Index were Taylor Wimpey up 3.7p to 195.2p, Worldpay Group up 7p to 383.6p, Kingfisher up 4p to 309.4p, Direct Line Insurance Group up 5.2p to 411.3p.

The biggest fallers were Paddy Power Betfair down 310p to 7,240p, Intercontinental Hotels Group down 176p to 4,235p, Provident Financial down 35p to 2,035p, G4S down 5.3p to 330.6p.