FTSE hits 16-month high after Brexit date set

A man walks through the lobby of the London Stock Exchange in London, Britain August 25, 2015. REUTERS/Suzanne Plunkett

LONDON (Reuters) - UK shares opened higher on Monday, rising after Britain’s Prime Minister Theresa May said that she would trigger the process to leave the European Union by the end of March, which put pressure on sterling.

The blue chip FTSE 100 index rose 0.9 percent to 6,960.43 points by 0800 GMT, hitting its highest level since June 2015.

The index fell sharply after Britain voted to leave the European Union on June 24, but has since recovered and is up nearly 10 percent, thanks to the large number of internationally-facing firms listed which have benefited from a fall in sterling.

“Confirmation from the Prime Minister yesterday that Article 50 will be triggered by the end of March 2017 superficially provides some more clarity for investors on the timing of the Brexit process, but in practice not much has changed,” Ian Williams, economist at Peel Hunt, said in a note.

“The much discussed two-year negotiation period is a minimum, and there are many unpredictable political events scheduled across the rest of the EU during that period,” he said.

The more domestically-exposed FTSE 250 index also rose, up 0.8 percent, led higher by a jump in Henderson Group’s shares which were up more than 18 percent after the fund management firm agreed a merger with Janus Capital.

“The fund management industry is polarising, with the likes of Henderson and Janus seeing the benefits of scale at one end, and smaller boutique fund management groups focusing on niche propositions at the other,” Mark Dampier, head of investment research at Hargreaves Lansdown, said.

The FTSE 250 didn’t fare as well as its blue chip counterpart in the aftermath of the referendum, but a raft of benign post-Brexit economic data has buoyed it by nearly 4 percent.

Reporting by Kit Rees; Editing by Jon Boyle