FTSE 100 higher but Ultra Electronics shares sink as chief leaves

Shares in Ultra Electronics sank by more than a fifth after the defence contractor issued a downbeat outlook and said its boss had left the company.

The FTSE 250 firm said the UK market had become increasingly difficult in the second half of the year due to budget pressures in defence programmes.

It also announced that chief executive Rakesh Sharma had stood down with immediate effect.

Shares in Ultra Electronics slumped 21% in early trade.

The fall comes on top of an 11% slide in its shares on Friday last week, when the company said a decision on its purchase of US firm Sparton was set to be delayed till March.

The latest drop in Ultra’s shares weighed on the FTSE 250 index, which was down 57.29 points at 19,963.56.

However, the benchmark FTSE 100 rose 21.08 points to 7,454.07, with drug firm AstraZeneca the biggest riser in the index, up 2.3%.

Worries over political uncertainty hit the pound on the currency markets. This followed a report in the Sunday Times at the weekend that 40 Conservative MPs have agreed to sign a letter of no-confidence in Prime Minister Theresa May.

Sterling fell 0.8% against the dollar to $1.3088 and dropped 0.6% against the euro to 1.1242 euros.