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* FTSE 100 slips, but near record high hit on Oct. 11
* Sterling edges back up on currency markets
* FTSE 100 down around 6 pct in 2016 in dollar terms
By Sudip Kar-Gupta
LONDON, Oct 12 Britain's index of leading shares
slipped on Wednesday from record highs reached in the previous
session, partly reflecting currency moves which weighed on some
of its global companies
The blue-chip FTSE 100 equity index, which hit a
record high of 7,129.83 points on Tuesday, fell 0.5 percent to
7,038.22 points. The FTSE 250 mid-cap index fell 0.4
percent but also remained near record highs reached this month.
The dollar dipped while sterling rebounded a touch from a
brutal sell-off this month, as British Prime Minister Theresa
May's offer to give lawmakers some scrutiny of the process
behind Britain's plans to leave the European Union calmed market
fears of a "hard Brexit".
That dollar weakness weighed on FTSE 100 companies for whom
much of their revenues are measured in dollar terms, such as
pharmaceuticals group Shire and engineering group Rolls
Royce, which both fell on Wednesday.
"I would not want to buy into the FTSE at these levels,"
said Horizon Stockbroking director Kyri Kangellaris.
The slump in sterling, which remains under pressure due to
concerns over Brexit, has been a key factor for the UK stock
market as Britain's most international firms stand to benefit
from higher repatriated earnings and stronger exports.
The pound's drop has boosted many of the FTSE 100's
international companies which earn much of their revenues in
U.S. dollars, and therefore get a currency-related accounting
lift as those dollars are converted back to pounds.
However, it has also impacted the U.S. dollar value of the
FTSE 100 - a potential negative for international investors for
whom the dollar is their benchmark reference, with the FTSE 100
down 6 percent so far in 2016 in U.S dollar terms.
A weaker pound can also hit UK consumer confidence, which
often impacts UK small and medium-sized companies, although the
FTSE 250 mid-cap index has been supported by corporate takeover
activity and signs of British economic resilience following the
Brexit vote in June.
Shares in UK mid-cap housebuilder Telford Homes
rose on Wednesday after it said it had not changed its growth
targets since the Brexit referendum.
Fidelity International fund manager Kevin O'Nolan said he
preferred the FTSE 100 to the FTSE 250 index.
"I have added a position favouring the FTSE 100 versus the
250. The 250 is more exposed to any slowdown in the domestic
economy while the 100's global companies benefit from the
weakness in sterling and improving commodity prices," he said.
(Reporting by Sudip Kar-Gupta; Editing by Keith Weir)