Weaker pound, upbeat earnings lift FTSE 100 ahead of Brexit-related talks

Reuters

Published Oct 14, 2020 08:28

Updated Oct 14, 2020 10:00

By Devik Jain

(Reuters) - The FTSE 100 rose on Wednesday, helped by a weaker pound and a clutch of upbeat corporate earnings, although growing political wrangling over new COVID-19 restrictions and uncertainty over a Brexit trade deal capped gains.

The blue-chip index (FTSE) climbed 0.6%, led by a 5.7% jump in London-listed shares of Just Eat (LON:JE) Takeaway.com NV (L:JETJ) as the food-ordering firm reported a 46% jump in its orders during the third quarter.

The mid-cap FTSE 250 (FTMC) also gained 0.6%, with polymer maker Synthomer Plc (L:SYNTS) surging 21.9% after it declared an interim dividend and raised its 2020 EBITDA outlook.

Investors are now looking for signs of progress in negotiations for a Brexit trade deal, with Prime Minister Boris Johnson and the head of the European Commission due to speak later in the day. Johnson has imposed a deadline of Oct. 15 for a deal.

"The market is pricing in about 40% for a no-deal and 60% for a deal and today could be the day," said Sebastien Galy, senior macro strategist at Nordea Asset Management in Luxembourg.

"There's very little hope that something is being achieved and the point is whether Boris Johnson is willing to sell this to his party as being a victory."

Johnson has also faced increased political pressure on his tiered plan to contain a surge in COVID-19 infections. Britain's opposition Labour leader Keir Starmer has instead called for a "circuit breaker" lockdown.

In company news, Bunzl Plc (L:BNZL) rose 5.6% after the company said it expected a slightly higher operating profit margin and stronger revenue growth in the second half of the year.

Money manager Ashmore Group Plc (L:ASHM) jumped 8.0% after the company said a rise in assets under management during the first quarter more than offset net outflows.