More retailer woes send London’s FTSE 100 lower

Fresh figures from the British Retail Consortium show UK retail sales were up by 2.5 per cent year on year last month, which is a growth of more than five per cent from last year.
Fresh figures from the British Retail Consortium show UK retail sales were up by 2.5 per cent year on year last month, which is a growth of more than five per cent from last year.

Another bad day for middle-class favourite and online supermarket Ocado led London’s FTSE 100 lower today.

The capital’s premier index dropped 0.25 per cent to 7,351.19 points, while the domestically-focused mid-cap FTSE 250 index, which is more aligned with the health of the UK economy, tumbled 1.77 per cent to 19,112.40 points.

Fresh inflation figures out today came in much hotter than expected, battering investors toward retailers over fears consumers will tighten their belts as their finances are squeezed.

The damage most heavily centred on Ocado, which shed 5.74 per cent and finished bottom of the FTSE 100.

High street fashion chain and trainer specialist JD Sports lost a shade over four per cent, while Next hopped 2.69 per cent lower.

Consumer-facing stocks have been battered by forecasts that the UK’s longest recession on record will be primarily driven by consumers cutting spending in response to high inflation.

Prices rose 11.1 per cent over the last year, the quickest acceleration in 41 years and above the City and Bank of England’s forecasts.

Analysts said the reading will pile more pressure on the Bank to keep hiking rates, which it has done so eight times in a row.

“It’s also not good news in the context of [today’s] budget with the Chancellor expected to tighten the vice further with a host of tax rises, as well as spending cuts,” Michael Hewon, chief market analyst CMC Markets UK, said.

The pound strengthened 0.3 per cent against the US dollar.