MARKET REPORT: Footsie rocked by worst weekly fall since August
The FTSE 100 posted its worst weekly performance since August amid a cocktail of economic and geopolitical problems.
On a gloomy trading day, the blue chip index fell 1.3 percent, or 97.39 points, to 7402.14 and the FTSE 250 fell 1.1 percent, or 180.41 points, to 17032.73.
That brought the FTSE 100’s losses this week to around 2.5 percent, the biggest drop since the index lost 3.5 percent in the week ending August 18.
Losses: On a gloomy trading day, the blue chip index fell 1.3 percent, or 97.39 points, to 7,402.14
The sell-off came as investors worried about the war in the Middle East and the possibility that interest rates would stay higher for longer.
Richard Hunter, head of markets at Interactive Investor, said many traders are unwilling to take on new positions “for a weekend where hostilities could worsen.”
He added: ‘At the same time, investors were somewhat dismayed by comments from Federal Reserve Chairman Jay Powell, who appeared to vacillate between implying no further rate hikes in the near future, while still leaving the door open for future rate hikes if circumstances require this.
“Given the recent pressure on markets, investors had hoped for final confirmation that the rate hike cycle was over and were therefore disappointed by the comments.”
London’s stock market had a smoother session after an incident on Thursday that halted trading in hundreds of smaller stocks.
Investors fled to safe havens such as gold, which hit a three-month high as Israel moved closer to launching an invasion of Gaza.
That sent Endeavor Mining shares an increase of 4.4 percent, or 74p, to 1760p.
Ingredient maker Treatt is looking for a CEO after its old boss announced his departure. Daemmon Reeve has been with the company for 32 years and has been in charge for more than ten years.
He will leave at the end of this year and Treatt’s finance boss Ryan Govender will take over until a permanent appointment is made. Shares were flat at 430p.
Rentokil shares returned to positive territory in early trading – a day after the pest control company warned of weaker demand in North America. But the shares, which fell 18.6 per cent on Thursday, eventually fell again, falling 4.1 per cent, or 19.7p, to 464.2p.
Mobico – the company behind National Express – posted profits after German state-owned rail group Deutsche Bahn agreed on Thursday to sell British bus and rail company Arriva to private equity firm I Squared.
Gerald Khoo, an analyst at investment bank Liberum, said the deal shows that “there is still clear interest among infrastructure investors in acquiring public transport companies.”
He added: ‘We view the read-across as particularly relevant in the case of Mobico, given the current low share price.’
Shares rose 8.5 percent or 4.8p to 61.3p.
AIM-listed ITM Power completed the sale of its joint business with Dutch energy company Vitol to the net-zero investment company founded by entrepreneur Jo Bamford.
The pair founded Motive Fuels in March last year to develop and roll out hydrogen filling stations in Britain.
It has been sold to HYCAP Group, meaning ITM will use the £28 million it has earmarked for the joint activities on other projects. Shares fell 4.7 percent, or 3.28p, to 66.48p.
Scancell has again postponed the publication of its results. The clinical-stage biopharmaceutical company was due to publish its annual results on October 12, but has postponed this until next Tuesday at the request of its accountant.
And while BDO insisted there were no ‘material audit issues’, the company said its results for the year to the end of April are still not finalized. Shares fell 3.6 percent, or 0.5p, to 13.5p.