FTSE drops amid energy pressure despite Wall Street lift
London’s top index ended the day 4.65 points, or 0.06%, lower at 7,585.01 points.
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Your support makes all the difference.The FTSE 100 finished in the red on Thursday as weakness in the energy sector and falls among commodity giants weighed on the index.
Nevertheless, the index closed the day only marginally lower after positivity in the US helped markets in Europe regain ground.
Drops from conglomerates including Associated British Foods and GlaxoSmithKline also kept the FTSE lower.
London’s top index ended the day 4.65 points, or 0.06%, lower at 7,585.01 points.
The theme of money moving to value names from growth stocks has taken a bit of a knock today
Chris Beauchamp, chief market analyst at IG, said: “The pattern of the past few weeks has seen the UK’s top index make gains while US stocks struggle, something that has become quite rare in recent years.
“But that move has been reversed today, and for a second consecutive day the bevy of banks, miners and oil stocks that make up the index’s heavyweights is falling back.
“The theme of money moving to value names from growth stocks has taken a bit of a knock today, but as with the bounce in the US it is not yet clear that today’s reversal is going to turn into anything more sustained.”
Europe’s other major markets were higher after the early sell-off was offset by an improvement in sentiment.
The German Dax increased by 0.65% and the French Cac rose by 0.3%.
Rises across Europe’s big three markets were driven by Wall Street with the New York markets bouncing on the opening bell amid strong performances for tech stocks.
Meanwhile, sterling nudged 0.1% lower versus the US dollar to 1.364, and was flat against the euro at 1.203.
In company news, Primark owner Associated British Foods (ABF) saw shares slide after it said it will cut around 400 jobs as part of efforts to keep a lid on costs.
The retailer’s owner said it will not increase prices for customers but highlighted a surge in costs, including higher energy prices and wage inflation.
Shares in the company closed 89p lower at 2,042p as it also described weakness in December following the impact of rising Covid-19 cases.
Meanwhile, Mr Kipling and Ambrosia maker Premier Foods bounced higher after it lifted its profit guidance following its strongest ever Christmas.
The UK’s biggest mince pie manufacturer forecast a profit of at least £145 million for the year to April, ahead of analyst predictions of around £140 million.
The St Albans food group finished the day 8.6p higher at 118.6p as a result.
Superdry dropped after its boss said that customers can expect price rises and no sales in its shops as the business tries to combat the increased costs it is facing due to runaway inflation.
Shares fell by 24p to 225p after the retailer reported that sales for the six months to October were a quarter below pre-pandemic levels.
The price of oil continued its buoyant spell this week as the easing of restrictions in the UK helped boost the outlook for traders.
Brent crude increased by 0.7% to 89.06 dollars per barrel when the London markets closed.
The biggest risers on the FTSE 100 were Pearson, up 23p at 683p; Scottish Mortgage Investment Trust, up 36p at 1,154p; Aveva, up 84p at 3,058p; and Fresnillo, up 22.4p at 861.6p.
The biggest fallers on the FTSE 100 were ABF, down 89p at 2,042p; Royal Mail, down 17.8p at 473.7p; ITV, down 2.8p at 115.6p; and Natwest, down 5.5p at 244.1p.