UKX FTSE 100 Index

By Carla Mozee, MarketWatch

Pound is moving lower after logging biggest one-day gain since 2008.

U.K. stocks advanced Wednesday, recovering some ground after suffering their worst loss in six months after the British prime minister revealed her government's Brexit plans.

The FTSE 100 rose 0.4% to 7,249.27, led by consumer goods, utility and health care shares. The index on Tuesday slid 1.5%, its worst performance since June 27 (http://www.marketwatch.com/story/ftse-100-slips-as-may-signals-britain-will-leave-eus-single-market-2017-01-17) , according to FactSet data. That move came after Theresa May said Britain will leave the European Union's single market, or make a so-called hard Brexit.

The U.K. does "not seek membership of the single market, but the greatest possible access to it," May said in her speech (http://www.marketwatch.com/story/uk-leader-theresa-mays-plan-for-brexit-text-of-her-speech-in-full-2017-01-17) in London.

Read: Why Theresa May is right to take a huge gamble on hard Brexit (http://www.marketwatch.com/story/why-theresa-may-is-right-to-take-a-huge-gamble-on-hard-brexit-2017-01-17)

(http://www.marketwatch.com/story/uk-leader-theresa-mays-plan-for-brexit-text-of-her-speech-in-full-2017-01-17)And:May offers escape hatch to U.K. banks, car makers in Brexit speech (http://www.marketwatch.com/story/uks-may-offers-escape-hatch-to-banks-car-makers-in-brexit-plan-speech-2017-01-17)

The selloff on Tuesday was spurred in large part by a surge in the pound against the U.S. dollar and the euro. The fall in sterling in recent months has aided FTSE 100-listed exporters, whose overseas profit gets a boost from the exchange rate.

One such multinational is Burberry Group PLC (BRBY.LN) , which pulls in more than 35% of its sales from the U.S. and China, according to FactSet data. The luxury-goods retailer's shares edged up 0.2% on Wednesday, after losing 2.7% in the previous session. The move came after Burberry posted third-quarter comparable sales growth of 3%, above analyst expectations (http://www.marketwatch.com/story/burberry-sales-beat-views-holds-to-profit-outlook-2017-01-18).

Sterling pulls back: The pound was lower, buying $1.2331, compared with $1.2378 late Tuesday, when the currency rallied nearly 3% to score its largest one-day gain since 2008.

The British currency jumped after May said the final Brexit deal negotiated by British and EU officials will be put to a vote in both houses of the U.K. parliament.

"Although May outlined a 'hard Brexit' scenario of the U.K. leaving the EU single market and customs union, her reassurances on transitional agreements and a parliamentary vote have buoyed sentiment for sterling," said Richard Perry, market analyst at Hantec Markets, in a note.

"The question is whether the bulls can now build on this platform for a sustained support and recovery," he said.

Other movers: Pearson PLC (PSON.LN) plunged 22% after the publisher of educational materials warned of lower future dividends (http://www.marketwatch.com/story/pearson-warns-on-profit-as-us-demand-slackens-2017-01-18) and profit, citing a slide in U.S. demand.

Economic data: A reading on U.K. unemployment in November is due at 9:30 a.m. London time, or 4:30 a.m. Eastern Time, from the Office for National Statistics. The unemployment rate is projected to hold at 4.8%. Average weekly earnings, both excluding and including bonuses, are expected to have risen by 2.6% in the three months to November, according to FactSet.

(END) Dow Jones Newswires

January 18, 2017 04:12 ET (09:12 GMT)

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