FTSE Suffers Worst Day in Three Months

• FTSE Suffers Worst Day in Three Months

The shock decision by UK Prime Minister, Theresa May, to announce a snap general election on June 8 left the FTSE 100 down 2.5 per cent to 7,147.50 at the close.

Investors seemed to back May’s assertion that the election could provide ‘certainty and security’ as the country undergoes Brexit negotiations. But as sterling strengthened against the euro and dollar, this put pressure on the FTSE 100’s overseas earners.

Commodity prices also remained weak across the board with iron ore and copper the biggest casualties, according to Interactive Investors.

Anglo American and Rio Tinto were the biggest blue-chip fallers.

BP slipped 3.5 per cent as authorities were able to control an oil and gas spill on the north slope of Alaska after it was discovered on Friday morning, according to media reports.

Oil giant Royal Dutch Shell slid by 2.8 per cent, while high street banks Royal Bank of Scotland and Barclays acted as a further headwind.

Investors on Wall Street were rattled by the uncertain political backdrop. The Dow Jones was 0.4 per cent lower in early trading.

Overnight, the crisis over North Korea kept Asian markets subdued as China’s SSE Composite and Hong Kong’s Hang Seng slipped by 0.7 per cent and one per cent respectively on Tuesday.

Japan remained resilient as the weaker yen helped exporting businesses such as Honda, prompting the Nikkei 225 to close 0.3 per cent higher.

Decent third quarter trading from asset manager Ashmore failed to excite the market as its shares retreated by 5.6 per cent to 343p. The fall probably reflecting profit taking after a strong run for the shares. Management reported a seven per cent increase in assets under management to $55.9bn.

UK housebuilder Bovis rose 2.1 per cent to 930.5p, thanks to a positive analyst note from broker Jefferies.