Rolls-Royce and defensives drive down UK blue chip index

The offices of the London Stock Exchange Group are seen in the City of London, Britain December 29, 2017. REUTERS/Toby Melville/File Photo

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  • FTSE 100 down 0.6%, FTSE 250 down 0.5%
  • UK unemployment rate falls to lowest since 2019
  • Degree tops FTSE 250 after 2022 outlook rise

April 12 (Reuters) – The UK’s main stock index closed on Tuesday as brokers’ downside calls on companies like Rolls Royce and weakness in defensive sectors offset gains in commodity-related stocks.

Rolls-Royce (RR.L) fell 5.5% to its lowest level in a month after JP Morgan downgraded the aircraft engineer’s stock to ‘underweight’ while raising concerns about its development plan for electric aero engines and green fuel options. Read more

The London Stock Exchange Group (LSEG.L) fell 2.9% after Exane BNP Paribas downgraded the stock to “neutral” on uncertainty over revenue growth.

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Overall, declines in defensive stocks such as AstraZeneca (AZN.L), which hit a record high last week, and Unilever (ULVR.L) weighed on the FTSE 100 (.FTSE). The index fell 0.6%, ending down for a second consecutive day.

On the other hand, oil majors BP (BP.L) and Shell rose along with crude prices, but that was not enough to keep broader markets strong.

“The rebound from March lows has taken the FTSE 100 back to February highs, but a short-term break now looks likely,” Chris Beauchamp, chief market analyst at online trading platform IG, said in a statement. note.

“But even so, with inflation driving higher prices and yields still rising in the months ahead, the index looks well positioned for further gains.”

Britons’ incomes fell the most since 2013 in February, after adjusting for soaring inflation, the figures were released on Tuesday, despite unemployment falling to a rate last seen at the end of 2019 and which hasn’t been lower since 1974. read more

The Bank of England is watching closely for signs that a lack of candidates to fill positions will drive wages up to the point of risking a wage-price spiral.

Among other individual stocks, Deliveroo (ROO.L) fell 1.1% after the food delivery company warned that consumer spending could slow for the rest of the year amid a squeeze on the Cost of life. Read more

The domestically focused mid-cap FTSE 250 index (.FTMC) fell 0.5%, with South African financial services group Investec (INVP.L) among the biggest losers.

Plus500 Ltd (PLUSP.L) gained 6.2% after the e-commerce company forecast annual revenue to beat market expectations.

Diploma (DPLM.L) jumped 11.5% after the technical goods and services provider raised its 2022 earnings outlook.

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Editing by Subhranshu Sahu and Ken Ferris

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