Strong sterling drags banks and oil giants lower

The UK's blue chip index failed to maintain the momentum which took it over the 7,200 mark earlier today.

A rally in sterling against the dollar hit heavyweight oil and banking stocks including BP (BP.) Royal Bank of Scotland (RBS), HSBC (HSBA) and Barclays (BARC), dragging the FTSE 100 lower.

Housebuilding stocks failed to offset these declines despite Persimmon's (PSN) upbeat update.

The UK's service sector expanded sharply in December and accelerated for the third consecutive month to a 17-month high, according to Markit's latest Purchasing Managers' Index.

The index rose from 55.2 to 56.2, which was driven by stronger growth in new work.

West Texas Intermediate and Brent crude oil lost earlier gains and declined to $52.83 and $56 per barrel, respectively.

Gold gained 1.5% to $1,181 per ounce and copper cheapened 0.8% to $5,577 per tonne.

FTSE 100 RISERS AND FALLERS

Persimmon reported a jump in forward sales in 2017, which reassured the market following a pre-New Year profit alert from Bovis (BVS). Investors overlooked Persimmon's slower sales run rate, which tailed off towards the end of 2016. The stock rallied 7.2% to £19.40.

Taylor Wimpey (TW.) and Barratt Developments (BDEV) made smaller gains on the update.

FTSE 250 RISERS AND FALLERS

Shares in oil and gas producer Tullow Oil (TLW) were flat after the announcement that chief financial officer (CFO) Ian Springett was taking an extended leave of absence to undergo medical treatment. Vice president of finance and commercial Les Wood was appointed interim CFO.

SMALL CAP RISERS AND FALLERS

Pan-African resources firm Asa Resource (ASA) dismissed press reports that Zindico Consortium filed a lawsuit concerning the group's Freda Rebecca mine. It said it was not served with any court papers and has no knowledge of the alleged claim.

Energy management systems manufacturer CAP-XX (CPX) catapulted 25.6% to 7p following its licensee Murata's introduction of the world's lowest profile 0.4mm supercapicitor.

Mobile computing solutions supplier Touchstar (TST) disappointed the market after announcing it will no longer meet expectations for the financial year to 31 December 2016. It blamed a deferral in certain orders into 2017 and bad debt at Touchstar Access Control. The stock plummeted 24% to 80p.

Oil industry services business Cape (CIU) said it will 'materially' beat expectations for full year results for 2016, triggering a share price rise of 17.4% to 178.5p.

Stevia ingredients producer PureCircle (PURE) reported net profit is expected to be lower than the first half of 2016 due to the detainment of shipments by US Customs Border Protection. The stock fell 6.4% on the news.

Gold explorer Kolar Gold (KGLD) issued 8.5 million shares to Mineral Exploration Network for 150 shares in Kaleva Gold under a joint venture to develop several licenses in Finland.

African airline Fastjet (FJET) signed a conditional agreement with commercial aviation group Solenta for a 28% stake and discounts of up to $19.2m for Fastjet on future services.

Investment firm Tejoori (TJI) entered a memorandum of understanding Mohammad Ali Abdulla to dispose its remaining Arjan plot of land for $5.8m. The market was happy with the decision, prompting a 17% jump in the share price to 0.3p.