FTSE 100 dogged by investors souring on Ashley’s Frasers Group

UK Daily Life 2022
The collection of the capital’s top companies dropped 0.23 per cent to 7,472.17 points, while the domestically-focused mid-cap FTSE 250 index, which is more aligned with the health of the UK economy, fell 0.56 per cent to 18,824.01 points (Photo by Dan Kitwood/Getty Images)

London’s FTSE 100 was dogged down today by retail tycoon Mike Ashley’s Frasers Group sinking to the bottom of the index.

The collection of the capital’s top companies dropped 0.23 per cent to 7,472.17 points, while the domestically-focused mid-cap FTSE 250 index, which is more aligned with the health of the UK economy, fell 0.56 per cent to 18,824.01 points.

In results out today, Frasers missed revenue expectations and warned the outlook for its collection of fashion firms was uncertain due to fears of a spending pull back amid the cost of living crunch.

That warning sent its shares nearly nine per cent lower and to the bottom of the FTSE 100.

Analysts said some of its companies such as upmarket fashion brand Flannels showed Brits are still keen to update their wardrobes.

“There are still deep pockets of resilience in the fashion retail sector, as shoppers’ spending holds up, particularly on ranges viewed as offering value. But despite its strong record the company is still unlikely to be immune to the recessionary headwinds whipping up,” Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said.

Pub giant and All Bar One owner Mitchells and Butlers dropped to the depths of the FTSE 250 today, losing more than 10 per cent despite earlier this week posting a solid set of results.

The pound strengthened around 0.6 per cent against the US dollar, while UK borrowing costs nudged higher ahead of what is expected to be a 50 basis point interest rate rise by the Bank of England next Thursday.