FTSE 100 watch: Footsie remains subdued as ECB leaves rates unchanged

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The UK benchmark index has lost ground in today’s session, staying in the red after the European Central Bank (ECB) left rates unchanged. The FTSE 100 has been hit by a recovery in the pound following Prime Minister Theresa May’s speech in Davos.

As of 14:13 GMT, Britain’s blue-chip index had lost 37.98 points to stand 0.52 percent lower at 7,209.63, remaining in negative territory after the ECB kept its monetary policy unchanged, in line with expectations, and reiterated that rates would stay at their current or lower levels for an extended period. The Footsie has been subdued in today’s session, with the pound reacting well to Theresa May’s speech in Davos and pressuring blue-chips with international exposure.

“Despite there being little new information in the Prime Minister’s Swiss address, sterling seemed sufficiently impressed,” Connor Campbell at Spreadex commented in an afternoon note. “This did, however, lead the FTSE more than 40 points lower, the UK index hampered not only by the pound’s rebound but also the losses in its commodity and banking sectors, as well as the six-percent post-Q3 update decline seen by Royal Mail.”

At the other end of the spectrum has been Burberry (LON:BRBY), whose shares have been in demand as Deutsche Bank, which sees the retailer as a ‘hold’, boosted its price target on the stock from 1,475p to 1,525p. Barclays meanwhile reiterated its ‘overweight’ stance on the company, valuing the shares 1,760p. Burberry’s share price has added 1.03 percent to 1,667.00p so far today.

The FTSE 100 index 0.42 percent down at 7,217.43 points as of 14:27 GMT on Thursday, 19 January 2017.

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