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Home>UPDATE: FTSE 100 under pressure as banks fall, pound rises against the euro

UPDATE: FTSE 100 under pressure as banks fall, pound rises against the euro

UPDATE: FTSE 100 under pressure as banks fall, pound rises against the euro

09/25/2017

By Carla Mozee, MarketWatch

Consumer-credit growth represents 'pocket of risk', says Bank of England committee

U.K. stocks slipped Monday, struggling as sterling climbed against the euro in the wake of Germany's general election, and as bank stocks sagged as the Bank of England reiterated a warning about risks from credit growth.

The FTSE 100 index fell 0.1% to close at 7,301.29, led by financial and mining shares. On Friday, the London benchmark rose 0.6% (http://www.marketwatch.com/story/ftse-100-sags-as-north-korea-us-tensions-flare-up-2017-09-22) and logged a weekly rise of 1.3%, the best week since early August, according to FactSet data.

But Monday's session began with investors watching the pound scale higher against the euro and the dollar. A strong value of the pound can eat into revenue overseas by multinational companies when they are repatriated, and, in turn, hurt shares of those companies that combined weigh heavily on the FTSE 100.

Among such names, British American Tobacco PLC (BATS.LN) (BATS.LN) fell 0.6%, engine producer Rolls-Royce Holdings PLC (RR.LN) (RR.LN) shed 1% and building-materials supplier CRH dropped 1%.

Against the euro, sterling bought EUR1.1359, more than EUR1.1295 late Friday in New York. But in dollar dealings, the pound backed off intraday highs and traded at $1.3456 compared with $1.3495 on Friday.

A "less than convincing Federal election win for German Chancellor Angela Merkel and French President Macron struggling in senate elections," dented the euro on Monday (http://www.marketwatch.com/story/euro-weakens-after-german-election-results-2017-09-25), said analysts at Accendo Markets.

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