Renewable Energy

FTSE 100 gains on weaker pound, rights issue knocks M&S

Credit: REUTERS/TOBY MELVILLE

The exporter-heavy FTSE 100 index gained on the back of a weaker pound on Wednesday as lawmakers signalled they would not back Prime Minister Theresa May's latest Brexit compromise, while Marks & Spencer slumped on news of a discounted rights issue.

FTSE 100 up 0.3%, FTSE 250 up 0.1%

M&S slips after discounted offering

Exporters top boost to main index

Pets at Home jumps after upbeat outlook

IG gains on new growth plan, boosts peers

Adds company news items, graphic, analyst comment

May 22 (Reuters) - The exporter-heavy FTSE 100 index gained on the back of a weaker pound on Wednesday as lawmakers signalled they would not back Prime Minister Theresa May's latest Brexit compromise, while Marks & Spencer slumped on news of a discounted rights issue.

The main index .FTSE, whose companies get more than two-thirds of their profit from abroad, was up 0.3% at 0816 GMT, while the more domestically-focussed FTSE 250 .FTMC was up 0.1%.

The indexes outshone European and Asian counterparts, where confidence was hit by media reports the United States is considering Huawei-like sanctions on Chinese video surveillance firm Hikvision.

A slide in sterling led internationally-exposed companies British American Tobacco BATS.L, Unilever ULVR.L and Diageo DGE.L to be among the biggest risers on the FTSE-100.

In contrast, blue-chip housebuilders including Persimmon PSN.L and Barratt BDEV.L lost more than 2% after gaining in the previous session when May unveiled her new Brexit deal.

M&S MKS.L slid 5% to a more than four-month low after it priced a rights issue at a big discount to Tuesday's close. It also reported a third straight decline in annual profit, emphasising the pain of its latest turnaround plan.

SSE SSE.L slipped 2% after reporting a slump in annual earnings and warning of an uncertain outlook due to the opposition Labour party's plans to renationalise energy networks.

Strong earnings reports lifted the mid-cap index, despite the pound's weakness.

Financial trading platform IG Group IGG.L surged 9.1% after it unveiled a plan to drive growth even as it forecast a drop in full-year net trading revenue and operating profit.

That helped rivals Plus500 PLUSP.L and CMC Markets CMCX.L to gains of 4.4% and 2.1% respectively.

Royal Mail RMG.L, the former postal monopoly, gained 7.2% - its biggest one-day rise in 5-1/2 years - as investors focussed on the company's new five-year turnaround drive instead of a dividend cut.

Pets at Home PETSP.L jumped 10% after reporting better-than-expected revenue and forecasting higher earnings for 2020.

Weighing on the index was engineering services group Babcock BAB.L, which tumbled 9.1% after saying it expected revenue and underlying operating profit to fall in 2019/2020.

Online trading platforms lag the wider index due to regulatory woeshttps://tmsnrt.rs/2WlhmfX

(Reporting by Muvija M and Shashwat Awasthi in Bengaluru; Editing by Andrew Heavens and Mark Potter)

((Muvija.M@thomsonreuters.com; within U.S. +1 646 223 8780, outside U.S. +91 80 6749 3638; Reuters Messaging: muvija.m.thomsonreuters.com@reuters.net))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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