Source: Sharecast
Also weighing on sentiment, overnight the US administration threatened to foist tariffs on an additional $11bn-worth of European exports in retaliation for what it said was the damage to its own aerospace industry from Brussels's subsidies for Boeing.
The FTSE 100 was down 0.35% at 7,425.57, while the pound was 0.1% weaker against the dollar US at 1.3016 and by 0.28% versus the euro to 1.1604, respectively, having caught a bid higher earlier on reports - later denied by Berlin - that German chancellor Angela Merkel might offer the UK a time limit on the Norther Irish backstop clause.
David Cheetham, chief market analyst at XTB, said traders rushed to buy the pound in anticipation of a breakthrough that could have potentially revived May’s deal by bringing hardline Tory Brexiteers and maybe even the DUP back onside.
"However, the gains were fleeting and they were promptly handed back when it was confirmed the reports were untrue and we can expect more of this sort of thing in the coming days. There remains an underlying feeling that a large and sustained move in the pound is just around the corner, but the problem for the here and now is that there will likely be several false dawns beforehand and heightened levels of volatility which lack a clear direction before that occurs."
The Prime Minister was meeting Merkel in Berlin and French president Emmanuel Macron in Paris to convince them to grant the UK a short extension to Article 50 ahead of Wednesday's EU summit. Reports out earlier suggest that the UK will be offered a long extension until the end of the year after the EU's chief negotiator, Michel Barnier, failed to convince EU member states that May has a plan to break the Brexit deadlock.
In London, meanwhile, talks continued between the government and the Labour party.
Away from Brexit, the IMF cut its forecasts for global GDP growth in 2019 from 3.7% to 3.3%, the least since the financial crisis.
The Washington-based lender, often termed the rich world's economic watchdog, put the risk of a no-deal Brexit at the top of its list of potential threats.
"In the face of significant financial vulnerabilities associated with large private and public sector debt in several countries, including sovereign-bank doom loop risks (for example, in Italy), there could be a rapid change in financial conditions owing to, for example, a risk-off episode or a no-deal Brexit," IMF chief economist Gita Gopinath said in the Fund's latest Global Economic Outlook.
Back on home turf, the latest figures from the British Retail Consortium and KPMG showed retail sales fell in March as Brexit uncertainty held consumers back from making big purchases.
Total sales dropped by 0.5% year-on-year from a 0.5% increase the month before. Meanwhile, like-for-like sales fell 1.1% in March compared to a 0.1% drop in February.
Still, Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said that on an ex-Easter basis, total sales appear to have risen by 2.5%, exceeding the growth rates recorded in January and February, of 2.2% and 0.5%, respectively.
"Granted, the year-over-year growth rate likely was flattered by the impact of bad weather in March 2018 on clothing sales. Even so, the data are consistent with the idea that Brexit uncertainty isn’t prompting consumers to change their expenditure significantly."
Sticking with the retail sector, Debenhams called in the administrators after refusing to accept a last-minute lifeline from Mike Ashley's Sports Direct despite his improved proposal to underwrite a £200m rights issue.
Elsewhere, shares in advertising giant WPP rallied on the back of a Telegraph report that buyout fund EQT is considering a multi-billion dollar bid for its Kantar consumer research business.
Standard Chartered reversed earlier losses to trade up following a report the bank is set to pay more than $1bn to resolve a five-year old investigation of potential US sanctions violations related to its Iran-controlled entities in Dubai and a UK probe.
Aviva was also on the rise as Goldman Sachs highlighted the insurer as one of its top picks in the space, along with Quilter and France's AXA.
Go-Ahead was hit by a downgrade to 'hold' from 'buy' at HSBC, while Pennon and Severn Trent were both dented as JPMorgan downgrades their shares to 'neutral' from 'overweight'.
Market Movers
FTSE 100 (UKX) 7,425.57 -0.35%
FTSE 250 (MCX) 19,433.76 -0.43%
techMARK (TASX) 3,551.95 -0.55%
FTSE 100 - Risers
ITV (ITV) 136.50p 2.25%
NMC Health (NMC) 2,471.00p 2.23%
WPP (WPP) 870.80p 2.09%
Hiscox Limited (DI) (HSX) 1,565.00p 1.23%
Experian (EXPN) 2,115.00p 0.91%
Reckitt Benckiser Group (RB.) 6,408.00p 0.85%
Antofagasta (ANTO) 1,004.50p 0.75%
Royal Bank of Scotland Group (RBS) 254.60p 0.71%
Smith & Nephew (SN.) 1,515.00p 0.53%
Auto Trader Group (AUTO) 531.20p 0.53%
FTSE 100 - Fallers
Smurfit Kappa Group (SKG) 2,288.00p -3.85%
TUI AG Reg Shs (DI) (TUI) 718.00p -3.11%
Just Eat (JE.) 720.00p -2.49%
Barratt Developments (BDEV) 605.60p -2.36%
Melrose Industries (MRO) 184.90p -2.28%
Fresnillo (FRES) 857.80p -2.14%
Berkeley Group Holdings (The) (BKG) 3,700.00p -2.12%
Morrison (Wm) Supermarkets (MRW) 222.80p -2.02%
Pearson (PSON) 822.00p -1.84%
Paddy Power Betfair (PPB) 6,018.00p -1.80%
FTSE 250 - Risers
Amigo Holdings (AMGO) 233.00p 5.67%
Sirius Minerals (SXX) 23.30p 5.53%
Vivo Energy (VVO) 132.80p 5.06%
Restaurant Group (RTN) 115.60p 3.31%
IntegraFin Holding (IHP) 365.50p 3.13%
Bakkavor Group (BAKK) 133.00p 2.94%
Provident Financial (PFG) 523.60p 2.79%
Morgan Advanced Materials (MGAM) 262.80p 2.42%
Hilton Food Group (HFG) 962.00p 2.34%
GVC Holdings (GVC) 593.60p 2.30%
FTSE 250 - Fallers
888 Holdings (888) 155.00p -4.32%
Mitchells & Butlers (MAB) 262.00p -3.85%
Redrow (RDW) 608.10p -3.14%
Syncona Limited NPV (SYNC) 259.00p -3.00%
Aveva Group (AVV) 3,250.00p -2.99%
Wood Group (John) (WG.) 519.00p -2.95%
Stagecoach Group (SGC) 133.30p -2.84%
Ted Baker (TED) 1,470.00p -2.78%
Crest Nicholson Holdings (CRST) 373.80p -2.71%
McCarthy & Stone (MCS) 125.70p -2.55%
