Despite UK wage growth stalling the market is still expecting the Bank of England to offer hints of an interest rate rise at tomorrow's meeting off the back of yesterday's big rise in inflation.
This provides support to sterling which is close to its highest level in 52 weeks. A stronger pound negatively impacts the value of the overseas earnings of the FTSE 100 which ends the day slightly lower and short of the 7,400 level.
Weaker metals prices hit the mining sector, Anglo American (AAL) fell 2.8% to £13.52 and Glencore (GLEN) slipped 1.7% to 364p.
According to media reports, motor insurer Sabre is planning an IPO after its owners failed to find a buyer. The company is expected to be valued at £600m.
The S&P 500 opened slightly lower, just south of the 2,500 mark. Investors appear slightly disappointed by the hefty price tag for iPhone X and a delay in shipping the new smartphone until November.
In Asia, investor sentiment was strong with the exception of Hong Kong as the Hang Seng fell 0.3% this morning to 27,894.
FTSE 100 RISERS AND FALLERS
A negative broker note from Macquarie on broadcaster ITV (ITV) dragged its share price 1.3% lower to 158p. The recommendation on the stock was cut to 'underperform'.
FTSE 250 RISERS AND FALLERS
Homewares retailer Dunelm (DNLM) hiked its dividend and increased its share of the homewares market to 7.9%. Investors were impressed by the company's latest results and overlooked a drop in sales and caution that consumers' disposable incomes were under pressure in the UK. Shares in the firm surged 7.5% to 660.5p.
Broker UBS reduced its rating for insurer Esure (ESUR) from 'neutral' to 'sell', which pushed the stock 3.5% lower to 254.7p.
Sales at housebuilder Galliford Try (GFRD) rose by 6% to £2,820m in the year to 30 June 2017 thanks to a strong underlying performance. There was also a 17% hike in the dividend and a 57% decline in pre-tax profits to £58.7m (affected by one-off charges on legacy contracts) to digest. Shares in the company pared earlier gains to trade down 1% at £13.45.
Infrastructure group Balfour Beatty (BBY) ticked up 0.2% to 264.1p following its decision to sell its 95% share in Blackpool Airport to Blackpool Council for £4.25m.
Bikes seller Halfords (HFD) nabbed Dixons Carphone (DC.) chief executive Graham Stapleton. The company reported that Stapleton is due to take up the post of CEO from 15 January 2018. Shares in Halfords advanced 2.7% on the news.
Financial services business Just Group (JUST) was flat at 161.6p despite strong results in the first half of 2017. Adjusted operating profit rose 39% to £67.2m.