Pound Hits Two-month Lows, U.K. Shares Gap Up
U.K. shares gapped up on Tuesday, spurred by a weakening British Pound after Britain’s parliament’s decision to pass legislation allowing the government to invoke Article 50 of the Lisbon Treaty.
The FTSE 100 index rose more than 0.1 percent, finding supports from oil and gas, health care and consumer-goods shares but banking stocks were trading lower, which caused the gain for the benchmark to be limited.
The Pound dropped more than 0.75 percent, dropping to as low as $1.21081 after the Parliament on Monday paved the way for Prime Minister Theresa May to launch divorce talks with the European Union. According to market sources, May is preparing to trigger Brexit in the last week of March. A weaker pound tends to boost U.K. shares as it raises the prospect for higher earnings and revenue made overseas by multinational companies listed in London.
Topping the market, shares of Prudential PLC added nearly 4 percent after the U.K.’s largest insurer announced to raise its ordinary dividend after earnings rose 7 percent.
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