London Stock Exchange Market hits new high

The London stock exchange market went on a high, supercharged by a Brexit-hit pound and energy giant BP’s surging annual profits, according to the dealers said.

Other European indices rose also by well over one percent as Wall Street built on the previous day’s gains in early New York business, ahead of US President Donald Trump’s State of the Union address.

Sterling sank on news that activity in Britain’s dominant service sector almost ground to a halt in January, as companies fretted over the nation’s looming departure from the European Union next month.

The weak pound boosted London’s FTSE 100 because the benchmark index features large multinationals earning in dollars and euros.

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“Results from BP and a weakening pound have propelled the FTSE 100 to a fresh two-month high,” said IG analyst Chris Beauchamp.

“Equities around the world remain in robust mood,” he added.

The IHS Markit/CIPS UK services purchasing managers’ index fell to 50.1 — its lowest level in two and a half years — down from 51.2 a month earlier. A reading above 50 indicates growth.

Concerns about Britain’s impending departure from the European Union dampened demand and caused firms to delay making decisions on new projects.

Later Tuesday, investors will focus on British Prime Minister Theresa May’s key Brexit speech in Northern Ireland.

EU president Jean-Claude Juncker will host May for talks in Brussels on Thursday as the two sides seek to save their Brexit deal.

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Sterling had won a partial reprieve on Monday after German Chancellor Angela Merkel struck a conciliatory tone over further Brexit talks.

Source: AFP

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