FTSE 100 hits record high as pound continues to fall

The FTSE 100 hit a record high today as the pound continued to fall. Picture: Benjamin Fathers/AFP/Getty Images
The FTSE 100 hit a record high today as the pound continued to fall. Picture: Benjamin Fathers/AFP/Getty Images
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The FTSE 100 has hit a record high as the pound tumbled further on Brexit jitters.

The UK’s top-flight index reached 7,129.83 points in mid-session trading – beating its previous record intraday high of 7,122.74, set in April 2015.

Shares have been surging higher while sterling has taken a battering since the Brexit vote, as many of the listed multinational companies benefit from earnings in stronger foreign currencies.

Against the US dollar, sterling dropped more than 0.8 per cent to trade as low as $1.225 today. The pound also fell against the euro, down about 0.3 per cent to €1.106.

READ MORE: Pound falls to fresh 31-year low in ‘flash crash’

Since the Brexit vote on 23 June, the FTSE 100 has made a healthy recovery, jumping about 12.5 per cent, while sterling has slumped more than 18 per cent against the US dollar over the same period.

Sterling ducked even lower today after leaked government papers laid bare the cost of leaving the EU. Switching to World Trade Organisation rules would cause gross domestic product to fall by up to 9.5 per cent and cost the Treasury up to £66 billion a year, compared with if the country remained in the EU.

Connor Campbell, a financial analyst at SpreadEx, said the news has “thrown more fuel on the fearful fire…leaving the markets to deal with another day of sterling dread”.

He added: “With that in mind, the pound, of course, has woken up wheezing and spluttering, continuing to shed an amount of blood that is apt for a month ending with Halloween.”

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