The United Kingdom’s blue chip index FTSE 100 futures gave up some grounds on Thursday as the country’s chip currency, the sterling, found a renewed strength in the ongoing negotiation of United Kingdom to divorce with the European bloc.
Formal Separation
The FTSE 100 futures tumbled 0.06%, losing 4.2 points, to finish at 7 369.52 as the British pound surged versus the US dollar and the euro as the markets were already calm yesterday following the start of the triggering of Article 50 last Wednesday.
The pound sterling rose against its major rivals benefiting from a calmer Thursday session as it posted 0.3% climb versus the greenback and jumped to 1.2474 from 1.2435 and a near 1% surge versus the euro at 85.67 pence from 86.6 on Wednesday.
Colin Cieszynski, chief markets strategist at CMC Markets said that triggering the Article 50 has really been good for the pound and that the currency is starting to seriously outperform other currencies, bad news for the FTSE 100, which takes advantage on a weaker pound.
Investors are now focusing on the European Union’s first draft document, which details its negotiation position on the formal process, after UK’s Prime Minster Theresa May triggered the Article 50 of the Libson Treaty on Wednesday to formally start the separation with the continental bloc nine months after the country decided to exit.
The EU is expected to release the bloc’s first draft document regarding its stand in the negotiation before the end of the week.