London equity markets had reversed opening losses to trade lower by midday on Friday, dragged down by weakness in travel-related stocks amid worries about Covid lockdowns.
The FTSE 100 was down 0.5% at 7,220.31.
Travel and leisure shares paced the decline following news that Austria will impose a national lockdown from Monday. British Airways and Iberia owner IAG, engine maker Rolls-Royce, Premier Inn owner Whitbread, InterContinental Hotels, Upper Crust owner SSP, Wizz Air, easyJet and Tui all slid.
IG market analyst Joshua Mahony said: “With Austrian cases surging over 400% in the last month alone, they do stand out as a particularly bad case when set against many of their European peers.
“However, with Covid cases turning upwards across the likes of Germany, France, and Portugal, there is a fear that today’s announcement is indicative of where other European nations could find themselves in two to three weeks’ time.”
Elsewhere, B&Q owner Kingfisher lost ground as it said reported a 2.4% drop in like-for-like sales for the third quarter but said annual results would be near the top of guidance.
Johnson Matthey was also under the cosh after a downgrade to ‘neutral’ from outperform’ at Credit Suisse.
Going the other way, Ocado was the top performer on the FTSE 100 on the back of a Deutsche Bank research note on Marks & Spencer, which suggested it could buy out the online supermarket. The bank said: “Cash flow is no longer being squandered on an unsustainable dividend but saved to recover the investment grade credit rating that may be required to buy out Ocado.”
Stocks had kicked the session off on a positive note following the release of upbeat retail sales data and a survey showing a pickup in confidence.
Figures out earlier from the Office for National Statistics showed retail sales rose more than expected in October, underpinned by spending on toys and close in the run-up to Christmas.
Retail sales were up 0.8% on the month, coming in ahead of expectations for a 0.5% increase and leaving sales 5.8% above pre-pandemic February 2020 levels. September’s sales figure was revised up from a 0.2% fall to flat.
Non-food store sales were the only major component to see month-on-month growth, of 4.2%, with second-hand sales making the biggest contribution. Within non-food, clothing sales jumped by 6.2%, with some retailers suggesting that early Christmas trading had boosted sales. Clothing stores sales are now just 0.5% below their pre-pandemic levels.
Meanwhile, “other” store sales, which include toy retailers, jumped 7.2%. Food store sales fell 0.3%, while petrol sales declined 6.4% in the wake of September’s panic-buying.
The retail sales figures came as the latest survey from GfK showed consumer confidence edged up in November despite the rising cost of living, although households’ view of their own finances remained weak.
The GfK consumer confidence index rose by three points to -14, reversing most of the four-point drop from the month before. Households were less gloomy about the general economic situation over the past 12 months and the coming year and were marginally more positive about their own finances for the coming year.
Market Movers
FTSE 100 (UKX) 7,220.31 -0.49%
FTSE 250 (MCX) 23,465.21 -0.46%
techMARK (TASX) 4,556.86 0.07%
FTSE 100 – Risers
Ocado Group (OCDO) 1,913.50p 7.74%
Royal Mail (RMG) 490.80p 2.10%
Sage Group (SGE) 804.80p 1.77%
Reckitt Benckiser Group (RKT) 6,210.00p 1.70%
SEGRO (SGRO) 1,387.00p 1.65%
AstraZeneca (AZN) 8,483.00p 1.22%
Pershing Square Holdings Ltd NPV (PSH) 3,060.00p 1.16%
Halma (HLMA) 3,160.00p 1.15%
Spirax-Sarco Engineering (SPX) 16,490.00p 1.10%
Darktrace (DARK) 530.00p 1.05%
FTSE 100 – Fallers
International Consolidated Airlines Group SA (CDI) (IAG) 147.24p -4.59%
Kingfisher (KGF) 323.30p -4.12%
Rolls-Royce Holdings (RR.) 135.80p -4.01%
M&G (MNG) 192.15p -3.39%
BT Group (BT.A) 162.15p -2.76%
Whitbread (WTB) 2,999.00p -2.72%
Prudential (PRU) 1,428.50p -2.69%
Compass Group (CPG) 1,519.00p -2.69%
Barclays (BARC) 190.28p -2.59%
Johnson Matthey (JMAT) 2,198.00p -2.57%
FTSE 250 – Risers
Trustpilot Group (TRST) 306.80p 3.30%
Kainos Group (KNOS) 1,893.00p 3.05%
Auction Technology Group (ATG) 1,380.00p 2.99%
Baltic Classifieds Group (BCG) 218.00p 2.35%
Volution Group (FAN) 521.00p 1.96%
Moonpig Group (MOON) 347.60p 1.94%
Spirent Communications (SPT) 285.40p 1.93%
Vivo Energy (VVO) 106.00p 1.92%
LondonMetric Property (LMP) 273.00p 1.87%
Investec (INVP) 371.70p 1.81%
FTSE 250 – Fallers
Rank Group (RNK) 146.60p -4.68%
SSP Group (SSPG) 250.50p -4.68%
easyJet (EZJ) 544.20p -4.63%
TUI AG Reg Shs (DI) (TUI) 205.20p -4.42%
National Express Group (NEX) 227.60p -4.29%
Restaurant Group (RTN) 84.60p -4.19%
Mitchells & Butlers (MAB) 230.00p -4.17%
Mitie Group (MTO) 67.10p -4.14%
Wizz Air Holdings (WIZZ) 4,214.00p -3.70%
Network International Holdings (NETW) 316.70p -3.62%
