Latest News

UK stocks slip as rate hike worries grip investors

UK stocks slip as rate hike worries grip investors By Reuters

Breaking News


Economy 7 minutes ago (Feb 06, 2023 17:41)

© Reuters. A trading screen is seen following the opening of the markets by British Chancellor of the Exchequer Philip Hammond and Chinese Vice-Premier Hu Chunhua at the London Stock Exchange in London, Britain June 17, 2019. REUTERS/Henry Nicholls/Pool/Files

By Sruthi Shankar and Shashwat Chauhan

(Reuters) – The UK’s FTSE 100 closed lower on Monday, as upbeat U.S. economic data last week sparked fears of further monetary tightening and as a top Bank of England (BoE) official voiced concerns that rates need to stay higher for longer.

The blue-chip FTSE 100 fell 0.8% after briefly hitting a new record high in the previous session, while the domestically-focused FTSE 250 recorded a near 1% drop after climbing to an eight-month peak last week.

Nearly all major sectors finished in the red, but precious metal miners eked out a meagre rise of 0.7%.

China-exposed financial services firm Prudential (LON:PRU) fell nearly 5% on concerns around elevated Sino-U.S. geopolitical tensions.

Globally, stocks wilted and government bond yields rose after last week’s upbeat economic data from the United States and other economies lessened the risk of recession, but also suggested rates might have to be hiked further.

“Markets are pricing some cuts this year and I think that is not going to work, that’s not going to be what transpires, so there is room for downside from here for equities,” said Vivek Paul, UK chief investment strategist at BlackRock (NYSE:BLK) Investment Institute.

BoE rate-setter Catherine Mann backed further increases in interest rates and warned that pausing risked a confusing “policy boogie” if it turned out rates would need to rise again.

The Bank of England delivered its 10th straight interest rate hike last week and signalled the tide was turning in its battle against high inflation.

Data on Monday showed Britain’s construction sector had its worst month in almost three years in January as rising borrowing costs hit house-building hard.

Looking ahead, the week houses some big corporate earnings, including oil major BP (LON:BP), drugmaker AstraZeneca (NASDAQ:AZN) and consumer goods maker Unilever (LON:ULVR).

Among individual stocks, Hargreaves Lansdown (LON:HRGV) fell 3.3% after Credit Suisse (SIX:CSGN) downgraded the wealth manager’s shares to “underperform” from “neutral”.

UK stocks slip as rate hike worries grip investors

Our Apps

Terms And Conditions
Privacy Policy
Risk Warning

© 2007-2023 Fusion Media Limited. All Rights Reserved.

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.

What's your reaction?

In Love
Not Sure

You may also like

More in:Latest News

Leave a reply

Your email address will not be published. Required fields are marked *