London’s FTSE 100 slumps regardless of US debt ceiling breakthrough
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ondon’s FTSE 100 dived on Tuesday as a breakthrough in US debt ceiling negotiations didn’t elevate the downbeat investor temper.
Consumer staples and vitality shares had been pulling on the blue-chip index with Unilever sinking towards the underside, and Shell lagging intently behind.
US president Joe Biden and home speaker Kevin McCarthy reached a remaining settlement on Monday on a long-awaited deal that has sparked fears the federal government might default on its debt for the primary time in its historical past.
But the deal to lift the nation’s debt ceiling is much from completed and dusted but, because it have to be authorized by Congress the place it’s anticipated to face criticism.
Investors on either side of the Atlantic didn’t seem like buoyant concerning the news, on a shorter week of buying and selling due to public holidays within the UK and US.
The FTSE 100 closed 105.13 factors decrease, or 1.38%, at 7,522.07.
In the US, the S&P 500 edged up by 0.15% and Dow Jones was down 0.4% by the point European markets closed.
It additionally got here as new meals inflation figures confirmed costs remained elevated in May, because the Government faces a backlash from retailers over plans to encourage supermarkets to voluntarily put value caps on meals staples to assist with the price of residing.
Michael Hewson, chief market analyst at CMC Markets UK, stated: “While one can sympathise with the Government’s desire to ease the cost of living, they might want to look a little closer to home as to the reasons why prices in general are as high as they are, starting with domestic energy policy, which has been a cornucopia of policy failures over the last 20 years.
“In any case, price controls have never worked as the UK’s experience of the 1970s will testify and only serve to drive scarcity, which keeps prices higher for longer,” he added.
The pound was holding agency on Tuesday, lifting 0.4% in opposition to the US greenback to 1.2401, and up 0.3% in opposition to the euro to 1.1567.
Other European shares began the week within the pink, with the German Dax down 0.27% and the French Cac 1.29% decrease at shut.
In firm news, ITV’s share value dropped almost 2% at first of the day amid hypothesis round former This Morning’s presenter Philiip Schofield’s departure and the knock-on affect for the broadcaster.
Analysts dismissed the saga as “noise” clouding the corporate and stated it was extra prone to be a short-term hiccup quite than a long-term downside for ITV and its share value. Nevertheless, shares had been down 0.75% at shut.
In higher news, meals producer Greencore noticed its share value leap after revealing its revenues surged by a fifth in its newest monetary half-year.
The pre-packaged sandwich maker stated the leap partially got here from value rises because it handed by value inflation of about 15%. Shares in Greencore climbed by 4.3%.
Shares in Hollywood Bowl loved a modest uplift after the bowling alley chain pledged to restrict value rises in a bid to maintain its leisure venues reasonably priced for households.
It got here because the agency reported document revenues for the six months to the tip of March and informed traders it was assured in “resilient demand” from clients. Its share value closed 1.15% larger.
The greatest risers on the FTSE 100 had been: Frasers Group, up 18p to 690p; B&M European Value Retail, up 9.9p to 471.0p; Hargreaves Lansdown, up 14.2p to 814.6p; JD Sports, up 2.45p to 153.45p; and Whitbread, up 50p to three,307p.
The greatest fallers on the FTSE 100 had been: Ocado Group, down 15.1p to 391.9p; Rolls-Royce Holdings, down 4.65p to 144.4p; Shell, down 70.5p to 2,282p; Unilever, down 124p to 4,405p; and Johnson Matthey, down 49p to 1,741p.