London stocks edged higher on Wednesday, even as sterling gained amid hopes of an extension to Article 50 and on the back of an unexpectedly positive surprise in the Chancellor's Spring statement.
By the end of trading, the FTSE 100 was 0.11% higher at 7,159.19, while the pound was 1.13% stronger against the US dollar and climbing 0.96% versus the euro to trade at 1.3222 and 1.1694, respectively, ahead of another Commons vote later on whether to leave the EU with no deal after MPs voted down Theresa May's Brexit plan on Tuesday night.
Laith Khalaf, senior analyst at Hargreaves Lansdown, said that taking a 'no deal' scenario off the table and extending Article 50 would be a tailwind for the pound, at least in the short term.
“These measures would buy politicians a bit more time to resolve the gridlock, but it's a stay of execution rather than a full pardon,” he said.
“It's hard to conceive right now but the current chaotic situation will pass, and the stock market will ultimately be driven by the growth in company earnings. In the short term though, sentiment takes a bigger role, for better or worse.”
Amid all the Brexit shenanigans, the Chancellor unveiled his fiscal plans which were little altered and continued to incorporate a “modest” fiscal stimulus for the fiscal year ahead.
However, thanks to upwardly revised forecasts for tax revenues and downwards revisions to its projections for interest payments, the Office for Budget Responsibility marked down its forecast for public sector borrowing between 2018/19 and 2023/24 by Â£30bn to Â£119bn.
Ahead of the budget, the government announced its tariff plans for a no-deal situation. As it stands, 80% of imports are tariff free. However, under a temporary scheme in the event of a no-deal Brexit, 87% of imports by value would be eligible for zero-tariff access. The plan would exclude some agricultural products such as beef, lamb, pork and dairy.
The government also said it would remove all border checks between Ireland and Northern Ireland bar a “small number of measures strictly to comply with international obligations, protect the biosecurity of the island of Ireland, or to avoid the highest risks to Northern Ireland business.”
In corporate news, Standard Life Aberdeen was sitting pretty at the top of the FTSE 100 after the asset manager posted a dip in full-year pre-tax profit but a 19% rise in IFRS profit attributable to equity holders as it abandoned its co-chief executive set-up, with Martin Gilbert stepping down to leave Keith Skeoch in charge.
Prudential ticked just a touch higher as it posted a jump in annual profits thanks to a solid performance from its Asian business and updated investors on plans to spin off its UK savings and investment arm.
On the downside, Hikma Pharmaceuticals was weaker as its full-year core operating profit missed analysts' expectations.
Wm Morrison Supermarkets reversed earlier losses to trade a little lower even as it declared a special dividend on top of its full-year payout after a third consecutive year of strong sales and profit growth.
Doorstep lender Provident Financial – which is currently fending off a hostile Â£1.3bn bid from smaller rival Non-Standard Finance – also gave back gains despite saying it swung to a statutory pre-tax profit ofÂ£90.7m in 2018 from a loss of Â£147.9m the year before.
British American Tobacco retreated even as its Canadian subsidiary was given creditor protection as it looks to avoid bankruptcy after a court ordered it to fork out CAD15.6bn in a class action lawsuit.
Cyber security firm Avast saw its shares drop as its annual organic growth came in light of expectations and outsourcer Capita fell as it confirmed late on Tuesday that it had received an unsolicited offer for the non-core travel businesses from Corporate Travel Management Limited several weeks ago.
FTSE 100 (UKX) 7,159.19 0.11%
FTSE 250 (MCX) 19,180.09 0.19%
techMARK (TASX) 3,500.56 0.23%
FTSE 100 – Risers
Standard Life Aberdeen (SLA) 250.80p 2.37%
BP (BP.) 547.80p 2.09%
Wood Group (John) (WG.) 573.80p 1.99%
TUI AG Reg Shs (DI) (TUI) 770.00p 1.69%
Melrose Industries (MRO) 179.95p 1.67%
Schroders (SDR) 2,718.00p 1.61%
Evraz (EVR) 619.20p 1.34%
Auto Trader Group (AUTO) 477.80p 1.29%
International Consolidated Airlines Group SA (CDI) (IAG) 539.00p 1.13%
Glencore (GLEN) 307.30p 1.09%
FTSE 100 – Fallers
GVC Holdings (GVC) 538.94p -5.12%
Hikma Pharmaceuticals (HIK) 1,584.50p -4.29%
British American Tobacco (BATS) 2,980.00p -3.43%
NMC Health (NMC) 2,610.00p -2.32%
Imperial Brands (IMB) 2,583.50p -1.79%
Paddy Power Betfair (PPB) 5,595.00p -1.58%
United Utilities Group (UU.) 848.00p -1.56%
Severn Trent (SVT) 2,030.00p -1.36%
BAE Systems (BA.) 462.60p -1.09%
HSBC Holdings (HSBA) 619.60p -1.02%
FTSE 250 – Risers
SIG (SHI) 141.20p 6.89%
Premier Oil (PMO) 82.90p 6.76%
Elementis (ELM) 160.40p 5.87%
Aston Martin Lagonda Global Holdings (AML) 1,181.00p 5.00%
Petrofac Ltd. (PFC) 486.30p 4.47%
Stobart Group Ltd. (STOB) 161.00p 3.74%
Bodycote (BOY) 840.00p 3.51%
Daejan Holdings (DJAN) 5,870.00p 3.10%
Hunting (HTG) 533.50p 3.09%
Hochschild Mining (HOC) 198.40p 2.93%
FTSE 250 – Fallers
G4S (GFS) 194.50p -4.56%
Metro Bank (MTRO) 823.00p -4.30%
Domino's Pizza Group (DOM) 226.70p -3.41%
Avast (AVST) 297.80p -3.30%
Quilter (QLT) 139.00p -2.82%
Just Eat (JE.) 738.20p -2.25%
Pershing Square Holdings Ltd NPV (PSH) 1,224.00p -1.77%
Games Workshop Group (GAW) 2,885.00p -1.54%
Provident Financial (PFG) 554.60p -1.53%
Bakkavor Group (BAKK) 129.00p -1.53%