FTSE 100 falls as fresh lockdowns across Europe dampen economic outlook
The FTSE 100 fell this morning as fresh Covid-19 lockdowns across Europe dampened hopes of a swift recovery in demand for industrial stocks including energy.
London’s blue-chip index sank 1.2 per cent, before recovering slightly to sit 0.6 per cent down at 8.30am.
Oil heavyweights BP and Royal Dutch Shell fell 3.2 per cent and 3 per cent respectively, after France and Italy announced fresh restrictions yesterday in the face of mounting coronavirus cases.
Mining and bank stocks including Rio Tinto, Anglo American, BHP Group, HSBC holdings and Barclays were also among the biggest drags on the index.
Luxury fashion brand Burberry was the biggest faller of the morning, as the brand’s announcement that it is opening a virtual store in Tokyo suggested bleak hopes for the return to bricks-and-mortar retail. Burberry shares fell 3.4 per cent at the bell this morning.
Pub operator JD Wetherspoon fell 1.1 per cent as the group announced an operating loss of £20.7m for the half-year, while revenue sunk by more than 53 per cent to £431.1m.
Outspoken Wetherspoons boss Tim Martin called for an end to lockdown “mayhem”, which has seen the bulk of the operator’s pubs shuttered for on-and-off for almost a year.
Natwest Group rose 0.4 per cent, after agreeing to buy back £1.1bn of shares from the government. The agreement with Natwest, formerly the Royal Bank of Scotland Group, represents the government’s third sale of its Natwest shareholding, bringing its stake down from 61.7 per cent to 59.8 per cent.
Meanwhile, the domestically focused mid-cap FTSE 250 index fell 0.8 per cent, dragged down by industrial stocks.
European stocks slid erasing a large part of their weekly gains this morning, as stock markets felt the weight of fresh regional lockdowns across the continent.
The pan-European Stoxx 600 fell 0.6 per cent, tracking a dour session on Wall Street overnight after US bond yields surged.
France’s CAC 40 was down 0.7 per cent after the nation imposed a new four-week lockdown from this morning in 16 regions including Paris suffering a fresh outbreak of Covid cases.