Worst day for more than a month for the FTSE 100; retail sales data disappoint
- UK retail sales fall 1.4% in May as consumers dine out
- Tesco down as sales growth slowed in first quarter
- FTSE 100 down 1.9%, FTSE 250 down 1%
June 18 (Reuters) – London’s FTSE 100 index on Friday marked its worst session in more than a month, dragged down by weakness in financial and commodity-related stocks, while data showed retail sales fell in May as Britons dined more following a lifting of the pandemic restrictions.
The FTSE 100 blue chip (.FTSE) finished down 2.0% and lost 1.7% this week, breaking a three-week winning streak. Bank (.FTNMX301010) and life insurance (.FTNMX303010) stocks, down 2.7% and 2.5% respectively, were among the biggest drag.
Base and Precious Metal Miners (.FTNMX551020) (.FTNMX551030) slipped 2.4% and 0.2% respectively, as commodity prices fell, especially with copper poised to experience its largest weekly drop since March 2020.
Meanwhile, oil majors BP (BP.L) and Royal Dutch Shell (RDSa.L) fell 2.7% and 3.1% respectively, following the drop in crude.
UK retail sales unexpectedly fell 1.4% last month as the lifting of lockdown restrictions encouraged spending in restaurants rather than stores, with grocery stores being the hardest hit. Read more
Britain’s largest retailer Tesco (TSCO.L) also reported a sharp slowdown in underlying UK sales growth in the first quarter, causing its shares to fall 4.1%. Read more
“When the UK government got kind of underhanded in their tactics to ease the lockdowns, especially on the travel side, it made people less sure what was going on and they just kept their hands in their pockets and n ‘haven’t spent that much,’ said Keith Temperton, equity trader at Forte Securities.
After the hawkish turn of the US Federal Reserve this week, all eyes are now on the Bank of England meeting next week where it is expected to consider the temporary rise in inflation. Read more
“Inflation rises and unemployment falls, but the Bank of England will do nothing to raise interest rates until it is sure that these are not transient factors emanating from an economy which went from red to green, ”said Laith Khalaf. , financial analyst at AJ Bell, in a note.
The Domestically Focused Mid-Cap Index (.FTMC) fell 1%, led by retailers, industrials and financials.
Among individual stocks, While Kin and Carta (KCT.L) rose 6.6% after Dutch insurer Aegon NV (AEGN.AS) disclosed a 5.24% stake in the processing services company digital.
Report by Devik Jain in Bangalore; Editing by Subhranshu Sahu
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