UK markets largely shrugged off Theresa May’s announcement that the terror threat level across the country had been raised to its highest level in the aftermath of Monday night’s devastating Manchester attack.
The benchmark FTSE 100 stock index rose tentatively to around 7,500 in early trading on Wednesday while the pound was broadly steady against the dollar at just under $1.30, having traded a touch lower on Tuesday.
The Prime Minister late Tuesday announced that the terror threat level in the UK had been raised to “critical” for the first time in 10 years, signalling that the threat of a terror attack had reached its highest level.
The change means that some 5,000 troops could be deployed to support police, including at concerts and sporting events. The UK's terror threat level had been set at "severe" for some time. It was last at "critical" in 2007.
But financial markets’ reaction was muted, with strategists and analysts saying that investors had largely adopted a wait-and-see approach ahead of next month’s general election.
Last Thursday, sterling cracked the $1.30 mark for the first time in almost eight months, spurred by strong retail data and political uncertainty exerting pressure on the dollar.
Sterling has added around 6.5 per cent since the start of the year against the dollar, but is still trading around 12.5 per cent lower since before June’s Brexit vote, after which it tumbled to a more than three-decade low.
