FTSE 100 slips as stronger pound, lockdown worries weigh

The domestically-focussed mid-cap FTSE 250 index lost 0.6%, with gold miner Centamin Plc tumbling 19.5% to the bottom of index after cutting its 2020 production forecast. New tiered restrictions in parts of England due to a resurgence in novel coronavirus cases and an impasse over a Brexit trade deal have pressured UK markets this week, with data also signalling a slowing domestic recovery.

London's export-heavy FTSE 100 fell on Wednesday as the pound jumped following optimistic comments about a post-Brexit trade deal, while investors weighed a rise in inflation and prospects of more coronavirus restrictions in England. Sterling rose to a one week-high against the U.S. dollar after the European Union's Brexit negotiator said that a new trade deal with Britain was "within reach".

The blue-chip FTSE 100 index dropped 1.2%, dragged by industrials, pharmaceutical and mining stocks. The domestically-focussed mid-cap FTSE 250 index lost 0.6%, with gold miner Centamin Plc tumbling 19.5% to the bottom of index after cutting its 2020 production forecast.

New tiered restrictions in parts of England due to a resurgence in novel coronavirus cases and an impasse over a Brexit trade deal have pressured UK markets this week, with data also signalling a slowing domestic recovery. The UK's public debt jumped to its highest since 1960 in the first half of the year, while annual consumer price inflation climbed to 0.5% in September, data showed on Wednesday.

"UK inflation figures continue to be thrown around by policy changes and demand-induced price spikes for a few specific goods and services," said ING economist James Smith. "But in the medium term, the pandemic is unlikely to be inflationary, given the growing concerns about the health of the jobs market (and) we expect further Bank of England stimulus in November."

Meanwhile, South Yorkshire in northern England will move into the very high lockdown tier on Saturday to tackle rising levels of COVID-19 infections, joining Liverpool and Lancashire in the highest tier. In company news, Metro Bank Plc jumped 1.7% after the lender reported a 2% increase in lending for the third quarter.

Bookmaker William Hill Plc rose 0.1% even as it reported a lower third-quarter revenue, while Chilean miner Antofagasta Plc shed 0.5% after it posted a 4.6% drop in third-quarter output.

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