FTSE 100 heads south amid global sell off
Investors across the pond were fretting over the prospect of rising interest rates.
The FTSE 100 followed its global peers into the red on Thursday as a renewed sell off on Wall Street continued to drag on equity markets.
London’s top flight ended down 27.61 points, or 0.39%, at 7,026.99.
“Despite a stronger start the FTSE soon followed its global peers into the red, dragged lower by renewed selling on Wall Street,” said Fiona Cincotta, senior market analyst at City Index.
Investors across the pond were fretting over the prospect of rising interest rates and a slowing Chinese economy, denting the Dow Jones Industrial Average.
In stocks, Unilever ended the day down 37.5p at 3,986.5p, despite seeing sales growth pick up across all divisions in the third quarter.
Revenue rose 3.8% overall to 12.5 billion euros (£11 billion), with sales up 1.4% across Europe as the region basked in prolonged hot weather, resulting in high demand for its ice cream.
Its update marks the first set of figures since Unilever’s embarrassing relocation U-turn saw the group ditch plans to move its corporate headquarters from London to Rotterdam following investor pressure.
Michael Hewson, chief market analyst at CMC Markets, said: “On balance the numbers show that the business is doing well, though not well enough given that the consensus around the forecasts was for 4.3% growth across the regions.
“Combined with the recent botched attempt to relocate the company’s HQ these numbers reinforce the uncertainty around the futures of the CEO Paul Polman and chairman Marijn Dekkers, whose judgment has been questioned about the overall strategy of the business.”
On the second tier, shares in Games Workshop tanked after the fantasy miniatures maker warned over uncertain trading.
The Nottingham-based group, which has been on a stellar run of form, said that while its performance up to October 7 has “continued well”, there are “some uncertainties in the trading periods ahead for the rest of the 2018/19 financial year”.
Shares in Games Workshop dropped 165p, or 5%, to 3,165p, making it one of the worst performers on the FTSE 250.
In currency, sterling once again found itself hostage to Brexit with ups and downs throughout the day.
The pound was down 0.3% against the US dollar at 1.305. Versus the euro, sterling fell 0.3% to 1.136.
Mr Hewson added: “The pound briefly hit a one week low against the US dollar despite reports that the UK government was open to extending the Brexit transition period beyond 2020.
“While some of the losses have been on the back of a stronger US dollar, a weaker than expected September retail sales number also weighed a little.
“The pound also came under pressure on reports that the UK government were concerned that EU leaders were close to pulling the plug on Brexit talks.”
In Europe, Germany’s DAX was down over 1% while France’s CAC slumped 0.55%.
A barrel of Brent crude was trading at 79.5 US dollars, down nearly 1%.
The biggest risers on the FTSE 100 were Pearson up 31.6p at 867p, Randgold up 194p at 6,258p, Diageo up 55.5p at 2,624.5p and United Utilities up 13.6p at 709p.
The biggest fallers on the FTSE 100 were CRH down 95p at 2,222p, Antofagasta down 27.8p at 767.4p, Ashtead down 67.5p at 1,936.5p and Standard Life Aberdeen down 7.6p at 263p.