© Reuters. FILE PHOTO: FILE PHOTO: The London Stock Exchange Group offices are seen in the City of London, Britain
By Devik Jain
(Reuters) – London’s fell on Wednesday as a stronger pound pressured exporters, while investors weighed higher inflation and surging coronavirus cases against optimism around vaccine trial results.
The blue-chip index slipped 0.3%, with real estate firm British Land sliding 3.9% after it warned of more pain in the office and retail sectors due to Brexit uncertainties and the COVID-19 pandemic.
The stronger pound weighed on shares of big dollar-earning companies such as British American Tobacco (LON:), Diageo (LON:) Plc and Unilever (LON:) Plc.
The domestically focused mid-cap added 0.2%, boosted by a 23.3% jump in Micro Focus International (LON:) after the IT company forecast higher annual margin.
Official data showed British inflation picked up by a little more than expected in October to 0.7%, as coronavirus restrictions tightened in much of the country.
“Rising cases and the restriction on activity that comes with it create speed bumps in the road to recovery but today’s upside surprise on inflation flies in the face of that narrative,” said Jai Malhi, a global market strategist at J.P. Morgan Asset Management.
Britain on Tuesday reported 598 deaths, its highest figure since May, and a further 20,051 cases, with a report saying British households would be banned from mixing when the lockdown ends.
On the Brexit front, sources told Reuters that European Union negotiators are due to update member states on the latest in trade talks on Friday, while a minister said Britain hopes to get a trade deal but the EU must understand that it is now dealing with a sovereign nation.
In company news, RSA Insurance Group jumped 3.8% after it received a cash takeover offer worth 7.2 billion pounds ($9.57 billion).
Halfords Group (LON:) Plc rose 1.1% after the bicycles and car products retailer reported a more than doubling in first-half profit on cycling boom.
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