London equity markets were sharply lower by midday on Thursday, with cyclical stocks under pressure amid worries about the economic recovery, as the latest Federal Reserve meeting minutes showed policymakers discussed slowing stimulus.
The FTSE 100 was down 1.9% at 7,012.85, extending earlier losses.
Oanda market analyst Sophie Griffiths said: “European stocks are sinking lower, reversing gains from the previous session following a weak handover from Asia.
“While stocks have been on a tear, hitting all-time highs last month, the mood in the markets is starting to sour. Concerns over the health of the economic recovery are denting risk sentiment and hitting demand for stocks even as the Federal Reserve moves towards tapering asset purchases.
“Inflation concerns and fears that the Federal Reserve could move to start tightening monetary policy have been lingering over the past few weeks, particularly since its hawkish shift at the June meeting. The minutes from the Fed’s June policy meeting confirmed that the central bank is moving towards tapering its asset purchases, potentially as soon as this year. However, the minutes also revealed that more evidence of a robust economic recovery would be needed to set a more defined timeline for tapering.”
In equity markets, cyclical stocks such as banks and miners were the worst performers, with Anglo American, Antofagasta, Glencore, Barclays and Lloyds all lower.
B&M European Value Retail slid even as the discount retailer said it made a strong start to the year as it reported first-quarter UK like-for-like sales up by more than a fifth compared with pre-pandemic levels.
Housebuilder Persimmon lost ground despite saying it was accelerating a capital return to shareholders as strong first-half trading generated revenue of £1.84bn.
WH Smith was trading a little lower even as it said that sales are gradually recovering as Covid restrictions ease and upgraded its full-year expectations thanks to an improved performance in North America.
TI Fluid Systems was hit by a downgrade to ‘add’ from ‘buy’ at Numis.
On the upside, food delivery group Deliveroo rallied as it lifted its full-year guidance after a strong second quarter, which saw orders grow 88%.
Ladbrokes owner Entain edged up after it increased its guidance for full-year earnings following a strong performance from the gambling group in the first half.
Market Movers
FTSE 100 (UKX) 7,012.85 -1.93%
FTSE 250 (MCX) 22,614.97 -1.55%
techMARK (TASX) 4,421.74 -1.41%
FTSE 100 – Risers
Just Eat Takeaway.Com N.V. (CDI) (JET) 6,810.00p 0.31%
Croda International (CRDA) 7,610.00p 0.18%
Entain (ENT) 1,806.00p -0.08%
SEGRO (SGRO) 1,152.50p -0.13%
Sainsbury (J) (SBRY) 284.70p -0.25%
BAE Systems (BA.) 527.60p -0.26%
Rentokil Initial (RTO) 516.40p -0.39%
Severn Trent (SVT) 2,633.00p -0.42%
Tesco (TSCO) 236.35p -0.46%
Imperial Brands (IMB) 1,567.50p -0.54%
FTSE 100 – Fallers
Whitbread (WTB) 3,053.00p -4.53%
Melrose Industries (MRO) 150.40p -4.42%
Persimmon (PSN) 2,935.00p -4.40%
Anglo American (AAL) 2,866.50p -4.16%
Antofagasta (ANTO) 1,383.00p -3.96%
Glencore (GLEN) 305.60p -3.94%
Barclays (BARC) 165.82p -3.87%
Intermediate Capital Group (ICP) 2,096.00p -3.85%
Burberry Group (BRBY) 1,993.00p -3.81%
Lloyds Banking Group (LLOY) 45.05p -3.72%
FTSE 250 – Risers
Cairn Energy (CNE) 151.50p 0.93%
Auction Technology Group (ATG) 1,190.00p 0.85%
Aggreko (AGK) 867.50p 0.52%
Indivior (INDV) 160.60p 0.50%
NCC Group (NCC) 310.50p 0.49%
XP Power Ltd. (DI) (XPP) 5,640.00p 0.36%
Chemring Group (CHG) 296.50p 0.34%
Just Eat Takeaway.Com N.V. (CDI) (JET) 6,810.00p 0.31%
Convatec Group (CTEC) 250.70p 0.28%
Syncona Limited NPV (SYNC) 215.00p 0.23%
FTSE 250 – Fallers
TI Fluid Systems (TIFS) 293.00p -6.84%
Carnival (CCL) 1,501.00p -4.72%
Electrocomponents (ECM) 1,032.00p -4.44%
Trainline (TRN) 297.40p -4.37%
Virgin Money UK (VMUK) 185.25p -4.09%
Playtech (PTEC) 413.40p -4.08%
Oxford Instruments (OXIG) 2,370.00p -4.05%
Telecom Plus (TEP) 1,142.00p -4.03%
Meggitt (MGGT) 431.20p -3.77%
Mitchells & Butlers (MAB) 271.80p -3.41%
