Financial and travel stocks weigh on the FTSE 100; Morrisons falls
- Morrisons shares tumble after $ 9.5 billion takeover
- Plus500 trading platform wins on solid forecasts
- AstraZeneca on breakthrough designation for drug
- FTSE 100 down 0.2%, FTSE 250 down 1.3%
October 4 (Reuters) – London’s FTSE 100 index fell on Monday as weakness in financial and travel-related stocks offset a rebound in energy, while Morrisons fell after private equity firm Clayton, Dubilier & Rice (CD&R) won a bid for the company.
The blue-chip FTSE 100 Index (.FTSE) ended down 0.2%, extending losses for the third session in a row, weighted by weakness in financials including HSBC (HSBA.L), Prudential (PRU .L) and Lloyds Group (LLOY.L).
Morrisons (MRW.L) fell 3.8%, its worst single-day drop since September last year, after US private equity firm CD&R won the auction for the fourth-largest supermarket British firm with an offer of 7 billion pounds ($ 9.5 billion), slightly above its offer of 285 pence per share, already recommended in August. Read more
Peer Sainsbury’s (SBRY.L) rose 3.3% in hopes that SoftBank’s Fortress Investment (9984.T) could turn its attention to the company after losing the bidding war for Morrisons.
The domestically focused mid-cap index (.FTMC) fell 1.3%, closing more than two months low, on the drop in consumer discretionary stocks.
The FTSE 100 is up nearly 8.5% year-to-date due to accommodative central bank policies and reopening optimism.
The index is, however, 2.3% below the highest point reached this year, as inflation risks and signs of slowing local and global economic growth weighed on investor morale.
“Inflation continues to support market sentiment, with fears over an extended period of above target prices leading to expectations of a dramatic revision in monetary policy expectations,” said Joshua Mahony, senior analyst at IG Group.
“Investors are increasingly concerned that the period of November and December will be characterized by a lack of supply and higher prices.”
Heavy trucks BP (BP.L) and Royal Dutch Shell (RDSa.L) limited further losses, rising 2.1% and 2.2% respectively, following higher crude prices.
Among other actions, AstraZeneca (AZN.L) rose 0.8% after its breast cancer drug, Enhertu, received a breakthrough therapy designation.
Online trading platform Plus500 (PLUSP.L) rose 1.8% after raising its forecast for the second time in less than three months.
Reporting by Bansari Mayur Kamdar, Shashank Nayar and Amal S; Editing by Sriraj Kalluvila and Andrew Heavens
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