The pound and euro were benefiting from a weaker dollar early Wednesday, while sterling was getting an additional lift from returning investor confidence in the UK as Rishi Sunak takes charge as prime minister.
Sterling was quoted at $1.1540 early Wednesday, sharply higher from $1.1464 at the London equities close on Tuesday. The pound had not hit $1.15 since mid-September.
The euro traded at $1.002 early Wednesday, moving back above parity for the first time since the start of October, and up from $0.9963 late Tuesday. Against the yen, the dollar was quoted at JP¥147.38, down from JP¥147.77.
The FTSE 100 index was down 15.08 points, or 0.2%, at 6,998.40. The mid-cap FTSE 250 was down 53.44 points, or 0.3%, at 17,778.19, though the AIM All-Share was down just 0.11 of a point at 799.33.
The Cboe UK 100 was down 0.2% at 699.57, the Cboe UK 250 down 0.1% at 15,202.98, and the Cboe Small Companies flat at 12,269.58
In European equities on Tuesday, the CAC 40 in Paris was marginally higher, while the DAX 40 in Frankfurt was 0.2% lower.
In London, Scottish Mortgage Investment Trust was down 1.9% in early dealings as its tech stock-heavy investment portfolio was suffering from the disappointing results overnight from Alphabet and Microsoft.
Big technology shares Alphabet and Microsoft both lost more than 6% after releasing quarterly figures - Alphabet A shares lost 6.6% in after-hours trade in New York, while Microsoft lost 6.7%.
Alphabet reported a sharp fall in quarterly income on higher costs and foreign exchange headwinds but recorded a rise in revenue.
The California-based Google owner reported a 27% fall in net income to $13.91 billion in the third quarter of 2022 compared to $18.94 billion a year before.
More positively, revenue rose by 6.1% to $69.09 billion in the period from $65.12 billion. The company attributed the revenue growth to healthy fundamental growth in Search and momentum in the Cloud business.
Microsoft reported a rise in first-quarter earnings, with Chair & Chief Executive Satya Nadella arguing that digital technology was the 'ultimate tailwind' in a world facing increasing challenges.
In the three months that ended September 30, revenue totalled $50.12 billion, up 11% from $45.32 billion the previous year. Revenue in the Intelligent Cloud segment increased by 20% against the previous year, while revenue in Productivity & Business Processes grew by 9.0%.
Microsoft, however, saw a fall in net income. The figure dropped 14% to $17.56 billion from $20.51 billion a year prior.
In the US, the week's strong rally continued, with stocks ending sharply higher on Tuesday, with the Dow Jones Industrial Average up 1.1%, the S&P 500 up 1.6%, and the Nasdaq Composite up 2.3%.
Back in London, WPP was at the bottom of the FTSE 100, giving back 3.5%.
Its third-quarter revenue rose 10% to £3.57 billion, with like-for-like revenue up 2.7%. The advertising and marketing firm noted its revenue less pass-through costs increased 13% to £2.99 billion.
Chief Executive Mark Read said the firm 'continues to show strong momentum'. He added: 'Our growth over the year has been strong with full year like-for-like revenue less pass-through costs now upgraded to 6.5% to 7.0%.'
Reckitt Benckiser was 3.0% lower.
The consumer healthcare firm's revenue increased by double-digit percentages in the third quarter, with its Hygiene, Health and Nutrition all seeing strong growth.
Total revenue was up 14% to £3.74 billion, with like-for-like revenue up 7.4%.
'Reckitt delivered another quarter of broad-based growth amidst challenging market conditions, as we continue to innovate and improve on our in-market execution,' Chief Executive Nicandro Durante said.
'My priority is firmly focussed on continuing to execute on our strategic path, to deliver sustainable mid-single digit growth, and mid-20s adjusted operating margins by the mid-2020s.' Reckitt narrowed its like-for-like net revenue growth target for 2022 upward to 6% to 8% from 5% to 8% previously.
At the other end of the blue chips, AstraZeneca was up 2.6% - crowning the FTSE 100.
The healthcare stock was on the rise after its CAPItello-291 Phase III trial showed its capivasertib, in combination with Faslodex, demonstrated a statistically significant and clinically meaningful improvement in progression-free survival versus placebo in patients with advanced or metastatic breast cancer.
The trial met both primary endpoints.
Susan Galbraith, executive vice president of Oncology R&D at Astra, said the data was 'exciting' and shows capivasertib could become a 'new first-in-class treatment option'.
Shore Capital kept Astra shares at 'buy'.
'Positive results announced today continue to reinforce our belief that AZN boasts an industry-leading R&D pipeline with a breadth of next-generation innovative assets,' it said. 'We continue to see plenty of scope for this pipeline to surpass expectations and deliver long-term, margin-enhancing revenue growth.'
In Asia, the Shanghai Composite closed up 0.8% and the Hang Seng index in Hong Kong added 0.7%. The Japanese Nikkei 225 index closed up 0.7%.
The S&P/ASX 200 stock index in Sydney closed up 0.2%.
Gold was quoted at $1,666.70 an ounce early Wednesday, higher than $1,655.96 on Tuesday evening in London. Brent oil was trading at $90.49 a barrel, down from $91.91 late Tuesday.
In the economic calendar, there's a US goods trade balance print, before the Bank of Canada issues an interest rate decision at 1500 BST.
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