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FTSE hits record high, pound tumbles

Press AssociationPress Association 11/10/2016

The FTSE 100 has hit a record high as the British pound tumbled further on Brexit jitters.

The index rose above 7122.7 to 7129.83 points in mid-session trading on Tuesday - the highest level since April 2015.

The top tier has 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.

Sterling dropped more than 0.8 per cent to trade as low as 1.225 against the US dollar on Tuesday. Sterling fell around 0.3 per cent to around 1.106 against the euro.

In the US dollar terms, the FTSE 100 is still down six per cent this year.

The FTSE 250 mid-cap index, whose companies are more exposed to the domestic UK economy, rose 0.8 per cent and was also near that index's record high.

The FTSE 250's companies have partly benefited from recent upbeat data that has led many forecasters to drop predictions that the British economy will slip into recession this year.

Some analysts also expect the drop in the pound to make British mid-cap companies cheaper and more attractive for potential overseas acquirers.

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