Directors at Britain's biggest firms are cashing in on a key Brexit rally

Directors at the UK's 350 largest listed companies have been selling more shares than they are buying in recent weeks.

The Financial Times reports that FTSE 100 and 250 directors have disposed of a net £10.5 million ($13.5 million) worth of stock since June 27, citing data from broker Olivetree.

The biggest seller was Edward Bonham Carter, the vice-chairman and former CEO of Jupiter Fund Management and brother of actor Helena. He sold £4.2 million worth of Jupiter on July 28.

Other big sellers include Richard Solomons at InterContinental Hotels, who sold £2.5 million of shares this month, and GlaxoSmithKline CEO Andrew Witty, who sold £170,000 on July 27.

This may seem like a worrying sign - executives selling stock in their own companies. But another way of looking at it is they are just taking advantage of a rally for British stock markets.

The FT quotes Bella Brandon, strategist at Olivetree, as saying: "It looks like some directors are taking advantage of the surge higher in equities. We are seeing a number of directors selling more than half a million pounds in shares, which is a significant amount."

The FTSE 100 and FTSE 250 tanked in the wake of Britain's shock decision to leave the European Union on June 23. But after a few sessions of weakness, both stock markets have rallied, with the FTSE 100 far surpassing its level prior to the vote.

Here is how the FTSE 100 looks:

The FTSE 100 has benefited from the fact that many of its constituents report their earnings in dollars, not pounds. Sterling has slumped to a 30-year-low against the dollar in the wake of the Brexit vote, meaning on paper many companies' revenues and profits look bigger, meaning the share price should go up. This has buoyed the index.

And here is the FTSE 250, which is more weighted towards UK-based companies:

Many analysts are more skeptical of the FTSE 250 rally given that most signs point to an economic slowdown in the British economy following the Brexit decision. Still, UK directors are clearly making hay while the sun shines.

Michael Hewson, chief market analyst at CMC Markets, is calling the FTSE 100 to open 9 points higher at 6,925 on Monday morning.

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