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UPDATE 2-FTSE 100 dips as global growth concerns dominate; Kier hits record low


ReutersLondon
Updated: 14-06-2019 22:11 IST
UPDATE 2-FTSE 100 dips as global growth concerns dominate; Kier hits record low

Image Credit: Pixabay

London's FTSE 100 weakened on Friday as Asia-focused banks took a hit from underwhelming Chinese industrial growth data, while Kier shed more than a third of its value after it was reported to be planning to sell its housebuilding unit at a discount. The FTSE 100 slipped by 0.3%, with exporter stocks also weighing on the index. The FTSE 250 fell by the same amount, tugged lower by Kier's 35.5% plunge.

Banks with exposure to Asia, pressured this week amid protests in Hong Kong against a Chinese extradition bill, slipped after China's industrial output growth slowed to a more than 17-year low. HSBC and Prudential were among the biggest drags on the blue-chip index as the data again underlined the knock-on effects of China's protracted trade dispute with the United States.

Builder Kier, shares in which lost more than a third of their value last week after a profit warning, sank to a record low after a Times report said the company was preparing to sell its housebuilding business at a discount to cut debt. Kier's market value, which stood at 212.1 million pounds ($267.4 million) at the close, has shrunk to less than half of what it was at the end of May.

"Trader is petrified that Kier will turn into an Interserve or even a Carillion, and any sign of weakness spooks investors," said CMC Markets analyst David Madden. The housebuilding sector slipped 1.2% on its worst day in a month as fears of a chaotic no-deal Brexit had jumped after Brexiteer Boris Johnson moved closer to becoming the next prime minister.

A no-deal departure from the European Union has become more likely over the past month, according to economists in a Reuters poll, with most candidates in line to replace Theresa May as prime minister taking a hard-line stance. Gold, generally viewed as a safer asset in times of geopolitical and economic turmoil, was in demand as worries over a slowdown in global economic growth dominated, helping miner Fresnillo to a 3.4% gain.

Oil major Shell was another bright spot on the main index as crude prices rose for a second day after attacks on two oil tankers in the Gulf of Oman stoked worries about crude flows through a key international shipping route. Utilities, considered to be defensive stocks, were also among the few gainers.

Small-cap recruiter SThree, which hires workers for financial, energy, banking and pharmaceutical companies, gained 3% as its net fees rose on strength in its international markets.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

COUNTRY : United Kingdom

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