European Stocks Rise After U.K. Vote as Pound Boosts FTSE 100By
European stocks climbed, boosted by gains in U.K. exporters after the country’s elections produced a hung parliament that may affect the country’s approach to Brexit.
The Stoxx Europe 600 Index rose 0.3 percent at the close. The benchmark is still down 0.6 percent in the past five days. The FTSE 100 index, whose members make more of their revenue abroad and benefit from a weaker pound, climbed 1 percent.
- Faced with calls to resign, British Prime Minister Theresa May moved fast to bolster her position. She held talks Friday morning with Northern Ireland’s Democratic Unionist Party, reaching a quick understanding to form a new government. May opted for a snap election to boost her parliamentary majority and strengthen her hand in the Brexit talks due to begin in just 10 days.
- British construction and property companies such as Taylor Wimpey Plc were among the worst performers in the Stoxx 600 as sterling dropped. The FTSE 250 Index of more domestically focused companies rose 0.1 percent after falling as much as 1 percent earlier in the day.
- “The FTSE 100 is cushioned, the FTSE 250 is a lot less cushioned by overseas currency exposure, so that should be reflected in the performance today and weeks ahead,” said Stewart Richardson, chief investment officer at RMG Wealth Management in London.
- The travel and leisure sector was the Stoxx Europe 600’s biggest decliner for the day and for the week. William Hill Plc. fell 2.5 percent to the lowest level in almost three weeks.
— With assistance by Justina Lee, and Elena Popina