The UK’s exporter-heavy FTSE 100 index opened lower on Tuesday, dragged down by a stronger sterling after a record-high wage growth spurred worries of inflationary pressures, while retailer Marks & Spencer led mid-cap stocks higher.
British wages excluding bonuses were a record 7.8% higher than a year earlier in the three months to June, adding to worries for the Bank of England about long-term inflation, which could keep interest rates elevated for longer.
The benchmark FTSE 100 index was down 0.2%, while the pound rose as much as 0.28% to $1.2720, right after the data.
Mid-cap stocks rose 0.1%, with British retailer Marks & Spencer jumping more than 8%.
M&S raised its profit outlook, saying it was continuing to win market share in both its clothing, home and food businesses. Retailers’ stocks rallied over 1%, leading sectoral gains.
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