FTSE 100 continues record run, rising for 14th day in a row
U.K. stocks gained for a 14th straight day on Friday, extending their record winning run as the weaker pound spurred investors to buy into British multinationals.
The FTSE 100 index UKX, +0.30% rose 0.5% to 7,327.85, on track for another record close. If it ends higher on Friday, it’ll mark a 12th consecutive all-time closing high, the longest such streak ever.
For the week, the London benchmark was set for a 1.6% gain. That would be its sixth straight weekly advance.
Sterling pressure: The index ended marginally higher on Thursday after the pound GBPUSD, +0.4275% was driven lower. The resumed selling pressure on sterling followed media reports that Prime Minister Theresa May will deliver a landmark speech Tuesday on plans for negotiating the U.K.’s exit from the European Union.
Critics have accused May of being unclear and not providing details on Brexit efforts. But the British leader has denied the government’s approach is “muddled”.
The pound struggled to recover on Friday, with sterling buying $1.2175 compared with $1.2163 late Thursday in New York and fetching GBPEUR, +0.0785% 1.1456 euros vs. $1.1462 on Thursday.
A weaker pound helps lift FTSE 100 companies, as it tends to aid multinationals that generate the bulk of their revenue outside of Britain.
“Sterling is back under pressure following the announcement that Prime Minister Theresa May is to make a major speech on Brexit and promoting a ‘Global Britain’. Markets tend to recoil against sterling any time the prospect of a ‘hard Brexit’ increases,” said Richard Perry, markets analyst at Hantec Markets, in a note.
A so-called hard Brexit refers to a scenario where the U.K. regains control of its borders, but gives up access to the EU’s single market. Economists fear losing access to the single market — the U.K.’s biggest export market — will hurt domestic business activity, and particularly the financial sector.
Movers and shakers: Drugmakers rebounded, having fallen after U.S. President-elect Donald Trump’s press conference on Wednesday. Trump hinted at forthcoming legislation that could erode the sector’s profitability.
Shares of Shire PLC SHP, +1.46% SHPG, -0.50% climbed 1.5%, Hikma Pharmaceuticals PLC HIK, +1.61% gained 1.4%, and AstraZeneca PLC AZN, +1.47%AZN, +0.21% added 1.1%.
On a more downbeat note, precious-metals miners declined as gold GCG7, -0.26% and silver SIH7, +0.00% prices moved lower. Shares of Fresnillo PLC FRES, -2.18% gave up 2.3%, and Randgold Resources Ltd. RRS, -0.37% GOLD, +1.75% fell 0.7%.