It was a downbeat end to the week for London’s FTSE 100 with inflation fears still at the forefront of investors’ minds amid a rise in bond yields.
Investors are concerned about inflation as it erodes the purchasing power of savings, and with commodity prices creeping up as the market buys into a global economic recovery, combined with huge monetary and fiscal stimulus pumped into the economy, it appears inflationary pressures may be brewing.
The UK’s benchmark index sunk 1.05% to 6,708.71 with the industrial, oil and transport sectors posting hefty losses. The mid-cap FTSE 250, which is a little better aligned to the UK economy, also fell, down 0.69% to 21,420.31.
The FTSE 100’s losses weren’t as severe as Asian markets but were more than the 0.9% decline recorded by Germany’s DAX 30 and 0.8% fall in France’s CAC 40.
Among the stocks falling has been International Consolidated Airlines (IAG), which shed 4.2% to 206.7p as the British Airways-owner confirmed it’s thinking of selling its flagship headquarters near Heathrow Airport. The cash-strapped airline plans a mix of home and office working going forward.
LOCKDOWN LOSSES FOR WETHERSPOONS
Pub group JD Wetherspoon (JDW) dropped 2.4% to £12.89 as it announced a pre-tax loss of £68 million for the half-year ended 24 January, following the government-imposed restrictions which forced the company to shutter its pubs.
Chairman Tim Martin said it was ‘disappointing’ that the regulations implemented ‘appear to have had no real basis in common sense or science’.
Scottish Mortgage Trust (SMT) fell 2.4% to £11.23 on news that joint portfolio manager James Anderson will step down in April 2022, when he is due to retire as a partner at Baillie Gifford.
The equities investor confirmed that joint portfolio manager Tom Slater will continue as lead portfolio manager when Anderson retires and Lawrence Burns, also a partner at Baillie Gifford, will become deputy portfolio manager.
Banking giant Barclays (BARC) lost 0.7% to 182.6p as it commenced its previously announced share buy-back programme of up to £700 million shares.
Retailer Halfords (HFD) decreased 2.7% to 327.5p after it agreed to buy Universal Tyre and Autocentres for £15 million in a deal that takes it closer to its target of having over 550 UK garages.
ELSEWHERE ON THE MARKET
Biotech firm Oxford Biomedica (OXB) slumped 8% to 940p after announcing Sanofi’s decision to terminate the collaboration and license agreement in the field of haemophilia gene therapy. The company said it will have a ‘negligible’ impact on revenue.
Financial services firm Sanne (SNN) surged 9.7% to 630p after the alternative asset and corporate services provider reported ‘strong profit growth’ in 2020, helping net revenue to reach £169.7 million.
UK housebuilder Taylor Wimpey (TW.) drifted 2.2% lower to 180.6p on news the Competitions and Mergers Authority had confirmed in a letter that its leasehold investigation has moved to the ‘formal consultation’ stage.
Engineering and industrial software company Aveva (AVV) gained 0.9% to £34.40 following news it has completed the acquisition of OSIsoft.
Premier Inn hotel owner Whitbread (WTB) lost 3.2% to £33.12 after announcing group HR director Louise Smalley will retire from the board on 31 August 2021.