London stocks had extended losses by midday on Monday as worries about rising inflation and the spread of the Delta variant dented sentiment.
The FTSE 100 was down 1.9% at 6,875.13, while sterling hit a three-month low against the dollar, trading 0.4% lower at 1.3711.
IG market analyst Joshua Mahony said: “UK stocks seem far from impressed ‘Freedom Day’, with the final removal of Covid restrictions doing more to raise fears of a more pronounced outbreak that raise hopes around an economic boost.
“Travel names are particularly feeling the brunt of this selling pressure, with airlines, bus companies, and cruise operators losing ground as Covid cases spike to over 50,000 per day. While the UK saw cases peak around 59,000 back in January, the recent R rate points towards a record high number before long. While restrictions have been eased the fact that Covid is so rife within the country does breed the kind of caution that could inhibit the exact economic activity encouraged by the government.”
Unsurprisingly, travel and leisure shares were the worst performers, with news that fully-vaccinated arrivals from France will still have to quarantine adding extra pressure on the sector. British Airways owner IAG, engine maker Rolls-Royce, catering group Compass, InterContinental Hotels, Premier Inn owner Whitbread, Cineworld, cruise operator Carnival, budget airlines easyJet and Wizz Air, and Upper Crust owner SSP were all weaker.
Online supermarket Ocado was under the cosh as it faced a week of disruption after a fire at its warehouse in south east London.
Neil Wilson, chief market analyst at Markets.com, said: “There is the immediate operational impact at Erith with orders being cancelled following the blaze, which was caused by a three-robot crash. There is reputational risk from cancelling swathes of orders – small I’d say – but nonetheless to be considered.
“But the main thing investors are concerned about is the safety of the technology – will this be repeated? It is only two years since the Andover facility burned down. Will this impact on future deals with international partners?”
Amid the sea of red, AstraZeneca fell even as it said that its drug to treat extensive-stage small cell lung cancer had been approved in China.
Spire Healthcare tumbled ahead of a shareholder vote on its proposed takeover by Australia’s Ramsay Health Care. Shareholders Toscafund Asset Management and Fidelity have already made clear that they oppose the deal.
On the upside, waste management firm Biffa surged to the top of the FTSE 250 after lifting its full-year earnings expectations following better-than-expected trading in the first three months of the year.
Market Movers
FTSE 100 (UKX) 6,875.13 -1.90%
FTSE 250 (MCX) 22,072.76 -1.75%
techMARK (TASX) 4,295.06 -1.71%
FTSE 100 – Risers
3i Group (III) 1,162.50p 0.26%
B&M European Value Retail S.A. (DI) (BME) 555.80p 0.14%
Just Eat Takeaway.Com N.V. (CDI) (JET) 5,848.00p 0.07%
Rentokil Initial (RTO) 518.60p 0.00%
Admiral Group (ADM) 3,281.00p -0.18%
Hikma Pharmaceuticals (HIK) 2,624.00p -0.23%
Antofagasta (ANTO) 1,361.00p -0.33%
London Stock Exchange Group (LSEG) 7,558.00p -0.55%
Pearson (PSON) 807.40p -0.57%
Severn Trent (SVT) 2,697.00p -0.63%
FTSE 100 – Fallers
International Consolidated Airlines Group SA (CDI) (IAG) 160.64p -4.26%
Rolls-Royce Holdings (RR.) 89.40p -3.93%
ITV (ITV) 116.65p -3.83%
Melrose Industries (MRO) 143.40p -3.79%
St James’s Place (STJ) 1,484.00p -3.76%
Ocado Group (OCDO) 1,738.00p -3.71%
Glencore (GLEN) 297.70p -3.66%
Intermediate Capital Group (ICP) 2,009.00p -3.51%
Associated British Foods (ABF) 1,979.50p -3.39%
Johnson Matthey (JMAT) 3,020.00p -3.24%
FTSE 250 – Risers
Biffa (BIFF) 340.50p 4.29%
Vivo Energy (VVO) 104.40p 0.97%
Sanne Group (SNN) 825.00p 0.36%
Ascential (ASCL) 422.60p 0.33%
Synthomer (SYNT) 504.00p 0.30%
Pennon Group (PNN) 1,245.00p 0.24%
Personal Assets Trust (PNL) 48,750.00p 0.21%
Moneysupermarket.com Group (MONY) 259.40p 0.08%
Just Eat Takeaway.Com N.V. (CDI) (JET) 5,848.00p 0.07%
Aggreko (AGK) 867.00p 0.06%
FTSE 250 – Fallers
Carnival (CCL) 1,318.20p -6.79%
Spire Healthcare Group (SPI) 219.50p -6.60%
Restaurant Group (RTN) 108.60p -6.22%
easyJet (EZJ) 780.20p -5.34%
Cairn Energy (CNE) 132.60p -4.95%
Rank Group (RNK) 157.80p -4.94%
Tullow Oil (TLW) 44.76p -4.81%
Frasers Group (FRAS) 566.50p -4.63%
VinaCapital Vietnam Opportunity Fund Ltd. (VOF) 438.00p -4.58%
Wizz Air Holdings (WIZZ) 4,217.00p -4.22%
