Oil slide and growth worries smother FTSE 100 while mid-caps bounce

By Muvija M (Reuters) - Britain's blue-chip index fell on Tuesday as perpetuating concerns over slowing global growth and an oversupply of oil spooked investors, while the mid-cap index gained after a small bounceback from retail stocks after an ASOS-led selloff. The FTSE 100 ended the day 1.1 percent lower while an uptick in retail stocks following sharp falls on Monday and a 17.7 percent surge in drugmaker Indivior shares helped the mid-cap index climb 0.5 percent higher after an initial loss. Christmas cheer seemed far with the mid-cap index, which was on track for its worst December on record, while the blue chips were set for their worst December in 16 years, both caught amidst global growth worries aggravated by Brexit uncertainty at home.

Reuters December 19, 2018 00:06:07 IST
Oil slide and growth worries smother FTSE 100 while mid-caps bounce

Oil slide and growth worries smother FTSE 100 while midcaps bounce

By Muvija M

(Reuters) - Britain's blue-chip index fell on Tuesday as perpetuating concerns over slowing global growth and an oversupply of oil spooked investors, while the mid-cap index gained after a small bounceback from retail stocks after an ASOS-led selloff.

The FTSE 100 ended the day 1.1 percent lower while an uptick in retail stocks following sharp falls on Monday and a 17.7 percent surge in drugmaker Indivior shares helped the mid-cap index climb 0.5 percent higher after an initial loss.

Christmas cheer seemed far with the mid-cap index, which was on track for its worst December on record, while the blue chips were set for their worst December in 16 years, both caught amidst global growth worries aggravated by Brexit uncertainty at home.

Investors were also bracing for a decision from the U.S. Federal Reserve late on Wednesday on the course of interest-rate hikes, with many believing a rate increase is likely.

On the flip side, retailers caught their breath after a selloff in the aftermath of Monday's profit warning from ASOS that sent shivers through the global retail industry.

ASOS, whose profit warning had dragged down the likes of Amazon.com and Target in the last session, closed in the red, giving up earlier gains following a rating upgrade from Credit Suisse.

Heavyweight Tesco advanced 2.1 percent on the main index. Among mid-caps, car distributor and retailer Inchcape provided the biggest boost with a 6.1 percent rise.

"There were 93 new 52-week lows and 0 new highs on the all share index yesterday, that's a very lopsided balance. I suspect today we are seeing some stocks bounce back from an oversold position on the absence of additional bad news," Peel Hunt analyst Ian Williams told Reuters.

The biggest drag on the FTSE 100 down were oil and related stocks that faced pressure from a sharp fall in crude prices on oversupply worries.

Shell dipped 2.4 percent after a Bloomberg report https://www.bloomberg.com/news/articles/2018-12-17/shell-is-said-to-eye-deal-for-endeavor-energy-as-price-tag-drops that the oil giant is in talks to buy Texas-based Endeavor Energy Resources LP for about $8 billion.

Bucking the trend was oilfield services provider Petrofac Ltd, which rose 3.2 percent after saying it would cut its debt more than analysts expected.

A 9.2-percent plunge made electricity and gas utility firm National Grid the top blue-chip loser after Britain's energy regulator proposed further cuts to the cost of capital for networks.

National Grid posted its biggest one-day drop in over two decades, with peers SSE and Centrica falling over 1 percent.

Shire dropped 3.6 percent, extending losses for the second session after rating agency Moody's downgraded Takeda, saying that its takeover of Shire will cause an almost six-fold increase to the Japanese drugmaker's debt.

Stealing the show was Indivior , which shot to the top of the mid-cap index after it stuck to 2018 targets and announced plans to launch a cheaper version of its blockbuster opioid addiction treatment, Suboxone, as it seeks to claw back market share lost to copycat versions of the drug. [nL3N1YN3LL]

A jump in the sterling on news that Prime Minister Theresa May will bring her European divorce deal back to parliament in mid-January gave Brexit-sensitive stocks, including homebuilders, a boost.

Taylor Wimpey was up 1.6 percent and Barrat rose 1.2 percent on the day.

(Reporting by Muvija M and Shashwat Awasthi in Bengaluru, Editing by Helen Reid in London)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.

also read

Israeli, UAE foreign ministers to meet in Germany on Tuesday
World

Israeli, UAE foreign ministers to meet in Germany on Tuesday

JERUSALEM (Reuters) - The foreign ministers of Israel and the United Arab Emirates will meet in Germany on Tuesday to discuss further steps in normalizing relations, officials said on Monday. Israel and the United Arab Emirates last month signed an agreement in Washington to normalise diplomatic ties and forge a broad new relationship.

Angry Birds maker Rovio's CEO leaving by mutual consent
News & Analysis

Angry Birds maker Rovio's CEO leaving by mutual consent

By Anne Kauranen HELSINKI (Reuters) - The chief executive of Angry Birds games maker Rovio Entertainment said on Monday she would leave the company by mutual consent at the end of the year. Kati Levoranta has led Rovio since 2016 and took the company public in 2017

Microsoft to build hub for cloud services in Greece
News & Analysis

Microsoft to build hub for cloud services in Greece

ATHENS (Reuters) - Microsoft Corp. is to build a data centre hub in Greece as it invests in cloud services infrastructure in the country, a boon to an economy weakened by a decade-long debt crisis and the coronavirus pandemic.