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LONDON MARKETS: FTSE 100 Erases Gains For The Year, As Election Grips Investors
Dow Jones News
By Carla Mozee, MarketWatch
Parliamentary vote due later; Burberry slides after sales update
U.K. blue-chip stocks on Wednesday slipped and turned lower for the year, as investors waited for a parliamentary vote expected to confirm Britain will hold an early general election in June.
Meanwhile, earnings reports have been rolling in. Shares of luxury goods maker Burberry Group PLC struggled after its financial update.
The FTSE 100 shed 0.2% at 7,131.80, with only the basic materials and financial groups printing gains. The index on Tuesday slid 2.5% to close at 7,147.50, the largest single-session percentage drop since June 27, 2016. That was just after U.K.'s vote to leave the European Union.
The fall on Wednesday means the benchmark lost its year-to-date gain, and is now down 0.2% for 2017.
On Tuesday, British Prime Minister Theresa May said she wanted to hold a snap general election on June 8 (http://www.marketwatch.com/story/uk-leader-theresa-may-calls-snap-general-election-on-june-8-2017-04-18), rather than waiting until 2020 as scheduled. The move is seen as a bid to strengthen May's position in Brexit negotiations with EU officials, as a resounding win would give the government a mandate for its approach.
She will seek parliamentary approval for the vote (http://www.marketwatch.com/story/uk-lawmakers-on-wednesday-expected-to-ok-snap-election-2017-04-19) on Wednesday, likely after Prime Minister's Questions at around lunchtime. May is widely expected to receive the required backing of two-thirds of lawmakers.
The pound was buying $1.2826 ahead of the parliamentary vote, compared with $1.2841 late Tuesday. Sterling had been trading above $1.25 early Tuesday.
Stock movers: Mining stocks were higher Wednesday, rebounding from the previous day's battering. Shares in the sector were dragged down by a slide in iron ore prices, which were hit by concerns about Chinese growth.
Glencore PLC (GLEN.LN) rose 1.8%, and Antofagasta PLC (ANTO.LN) moved up 1.9%.
Among individual movers, Burberry (BRBY.LN) sank 6.4%, its biggest loss since October 2016, after the luxury goods retailer gave a financial update. It said second-half underlying revenue was down at GBP1.61 billion (http://www.marketwatch.com/story/burberry-revenue-down-but-boosted-by-fx-gains-2017-04-19) ($20.6 billion) although it was boosted by foreign exchange gains.
Associated British Foods PLC shares (ABF.LN) jumped 3.1% to lead the FTSE 100. The food ingredients producer and owner of retailer Primark raised its dividend and said its outlook for its fiscal 2017 has improved. (http://www.marketwatch.com/story/ab-foods-profit-up-36-as-primark-sales-beat-view-2017-04-19)
(END) Dow Jones Newswires
April 19, 2017 04:33 ET (08:33 GMT)Copyright (c) 2017 Dow Jones & Company, Inc.
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