By Steve Goldstein, MarketWatch
The pound advanced on Thursday, with the gains for the U.K. currency proving a drag for the shares of British exporters.
The pound /zigman2/quotes/210561263/realtime/sampled GBPUSD -0.1377% traded at $1.2652 vs. Wednesday’s close of $1.2611.
The U.K. discussion continued to be on the £30 billion spending plan unveiled by Chancellor of the Exchequer Rishi Sunak.
“Importantly, [Wednesday’s] statement marked an important turning point; with the Treasury moving away from looking to keep people attached to their current employer, and turning attention towards helping people get back into employment,” said Michael Brown, senior market analyst at Caxton.
The pound’s strength had the opposite impact on the FTSE 100 /zigman2/quotes/210598409/delayed UK:UKX -1.50% , which slumped 0.6%, the worst of the major regional markets in Europe.
Troubled engine maker Rolls-Royce /zigman2/quotes/203646520/delayed UK:RR -1.36% slumped 8%, as the company took a $1.45 billion hit for closing currency hedges early, citing the deterioration in the medium-term outlook caused by COVID-19. Rolls-Royce says that it may announce noncash accounting adjustments when its first-half results are announced.
Shares of U.K. home builder Persimmon /zigman2/quotes/206444744/delayed UK:PSN +1.95% rose 6% after it said net reservations rose 30% year-over-year in the final six weeks to June 30.