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Aug. 30, 2018, 11:49 a.m. EDT

FTSE 100 ends lower as buzz persists about EU official’s upbeat Brexit remark

Analyst says Michel Barnier’s comment is positive, but lacks details

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By Victor Reklaitis, MarketWatch


EMMANUEL DUNAND/AFP/Getty Images
Michel Barnier has the U.K. market’s attention this week.

The U.K.’s main stock index finished with losses Thursday, as a stronger pound continued to weigh on the gauge.

Sterling was dipping but still up significantly for the week, helped by the European Union’s top Brexit negotiator offering an olive branch a day ago.

How markets are performing

The FTSE 100 /zigman2/quotes/210598409/delayed UK:UKX +1.20% fell 0.6% to end at 7,516.03, after retreating 0.7% in the prior session.

The British blue-chip gauge is showing a drop of 0.8% for the week, and it’s down 2.2% for the year to date.

The pound /zigman2/quotes/210561263/realtime/sampled GBPUSD -0.1492% was buying $1.2994, down slightly from $1.3028 late Wednesday in New York. It’s up against the dollar by about 1.1% for the week.

A stronger pound can hold back the FTSE 100 because the index’s multinational companies generate most of their sales in other currencies.

What’s moving markets

EU negotiator Michel Barnier said Wednesday the trade bloc was willing to offer the U.K. an unprecedented partnership, delivering a big boost to the pound for that session.

His comments have helped ease concerns about the potential for a “no-deal Brexit,” meaning a disorderly departure from the EU by the U.K., without an agreement on future trade relations.

Read more: Gear up for a no-deal Brexit: 5 areas investors should watch

And see: A top London startup’s CEO flags the biggest Brexit threat to his industry

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What are strategists saying?

Barnier’s “softer language will be a positive but A) There is yet scepticism about what it all means with few details on any of this; and B) We have heard this kind of language in the past,” said Neil Wilson, chief market analyst for Markets.com, in a note.

Stocks in focus

Shares in Vodafone Group PLC /zigman2/quotes/202484985/delayed UK:VOD +0.42% fell 3.1% after the telecom announced a merger deal for an Australian business.

Off the FTSE 100, Hays PLC’s stock /zigman2/quotes/208836868/delayed UK:HAS +4.55%  dropped 4.3%, even as the recruitment company announced a special dividend following a rise in full-year profit.

/zigman2/quotes/210598409/delayed
UK : FTSE UK
5,899.26
+69.80 +1.20%
Volume: 727,492
Sept. 23, 2020 4:59p
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/zigman2/quotes/210561263/realtime/sampled
US : Tullett Prebon
1.2716
-0.0019 -0.1492%
Volume: 0.0000
Sept. 23, 2020 4:30p
loading...
/zigman2/quotes/202484985/delayed
UK : U.K.: London
104.42 p
+0.44 +0.42%
Volume: 53.81M
Sept. 23, 2020 4:35p
P/E Ratio
N/A
Dividend Yield
7.54%
Market Cap
£27.90 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/208836868/delayed
UK : U.K.: London
110.40 p
+4.80 +4.55%
Volume: 14.19M
Sept. 23, 2020 4:35p
P/E Ratio
32.76
Dividend Yield
0.00%
Market Cap
£1.77 billion
Rev. per Employee
N/A
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Victor Reklaitis is a London-based markets writer for MarketWatch. Follow him on Twitter @VicRek.

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