Nervous firms eye markets
Deputy City Editor
Sharp swings on the currency markets yesterday could have a marked influence on company profits, analysts said yesterday. Their models suggest that companies with substantial exports to the Continent will suffer most from the dollar's rise against sterling and the relative weakness of the mark. Businesses with a large US presence, or dealing in dollar-denominated commodities, will benefit, however.
British Steel was highlighted yesterday as an extreme case of a firm likely to be squeezed by rising input costs denominated in dollars and less valuable selling prices based on a mark benchmark. Its shares closed 4.5p lower at 175.5p.
Other sectors likely to be watching the pound's rise against the mark with alarm include engineers, especially the motor manufacturers, and building materials, where companies such as RMC and Redland are highly dependent on German earnings.
Sectors tipped to benefit include pharmaceuticals companies, which make an average of 48 per cent of their sales in the US. The pharmaceuticals and household-goods sectors were two of the strongest performers in the market yesterday. Oil companies should also benefit, with a quarter of their sales in America and the oil price denominated in dollars.
Woolwich terror attack: Suspect Michael Adebowale saw friend 'literally sliced to pieces' in 2008
Emergency landing at Heathrow sparks further controversy over London airport capacity
Unrest may spread across Europe, warns Red Cross chief
EDL marches on Newcastle as attacks on Muslims increase tenfold in the wake of Woolwich machete attack which killed Drummer Lee Rigby
You want to get an Eton scholarship? All you need to do is answer four (not so simple) questions
- 1 What, let gays get married? We must be bonkers
- 2 Rocky Horror star Tim Curry 'suffers major stroke'
- 3 Exclusive: How MI5 blackmails British Muslims
- 4 EDL marches on Newcastle as attacks on Muslims increase tenfold in the wake of Woolwich machete attack which killed Drummer Lee Rigby
- 5 Farewell, Shameless. Your heirs have work to do
BMF is the UK’s biggest and best loved outdoor fitness classes
Find out what The Independent's resident travel expert has to say about one of the most beautiful small cities in the world
Nook is donating eReaders to volunteers at high-need schools and participating in exclusive events throughout the campaign.
Get the latest on The Evening Standard's campaign to get London's children reading.
Win anything from gadgets to five-star holidays on our competitions and offers page.