FTSE 100 stocks hurt badly: biggest fallers revealed
Responding to an overnight sell-off on Wall Street, UK blue-chip shares fell to their lowest in over three weeks. City writer Graeme Evans assesses the damage.
16th April 2024 13:48
by Graeme Evans from interactive investor
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A crowded FTSE 100 fallers board today included Marks & Spencer Group (LSE:MKS) and Lloyds Banking Group (LSE:LLOY) as UK labour market uncertainty added to worries blowing in from Wall Street.
The risk-off mood, which was replicated across Europe after Monday’s technology-led slump for US markets, left London’s top flight 1.4% or 107 points lower at 7,858 at lunchtime Tuesday.
Glencore (LSE:GLEN) and Rio Tinto Registered Shares (LSE:RIO) were among mining stocks 2% or more lower after the dollar rose to near a five-month high on expectations that US interest rates will stay elevated this year.
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As most commodities are priced in dollars, the recent increase has the potential to suppress demand by making products more expensive in local currency terms.
Even China’s robust first-quarter GDP figure of 5.3% and the support of mining industry analysts at Barclays failed to lighten the mood in the sector.
Barclays now values Anglo American (LSE:AAL) at 2,715p but shares fell 77p to 2,092p, while Glencore dropped 12.95p to 468.7p compared with a 515p target.
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The biggest fallers in the FTSE 100 were Pershing Square Holdings Ord GBP (LSE:PSH) and Scottish Mortgage Ord (LSE:SMT) Investment Trust after last night’s bruising session for US technology stocks.
The latter’s decline of 30.8p to 835.4p erased some of the recovery seen since it pledged £1 billion of buybacks in an effort to address the gap to its net asset value.
About 3% of its portfolio is invested in Tesla Inc (NASDAQ:TSLA), which has now lost 35% of its value this year after last night’s disclosure of thousands of job cuts in the face of Chinese competition.
Semiconductor giant NVIDIA Corp (NASDAQ:NVDA), which accounts for 8% of the trust’s assets as the joint biggest holding, fell 3% as US traders worried that US rates could stay on hold until December.
Alphabet Inc Class A (NASDAQ:GOOGL) backer Pershing Square, meanwhile, saw the gap to its net asset value of 5405p widen with a fall of 128p to 3876p.
Other stocks impacted by the weaker sentiment included Rolls-Royce Holdings (LSE:RR.), which retreated below 400p at one point, and the car retail platform Auto Trader Group (LSE:AUTO) after a fall of 19.4p to 673.8p.
Lloyds dropped 1.3p to 49.8p, a performance not helped by the surprise jump in the UK unemployment rate to 4.2% from the 3.9% seen in the previous three-month period.
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The shares were near 54p earlier this month, up from February’s 41p after the outlook was boosted by hopes for lower interest rates and a return to economic growth.
’As well as fears over how a weaker jobs market might affect the health of its loan book, today’s wage growth figures dealt a blow to prospects of stimulus through a near-term cut in borrowing costs. Lloyds is due to present first-quarter results on Wednesday 24 April.
NatWest Group (LSE:NWG), which presents figures on 26 April, fell 5.8p to 271p but is more than 20% higher over the year to date. Barclays (LSE:BARC) lost 2.9p to 180.2p.
The economic and consumer spending uncertainty also dented another UK bellwether in retailer Marks & Spencer, which fell 5.1p to 249.1p.
Defensive stocks including Centrica (LSE:CNA), Severn Trent (LSE:SVT) and Smith & Nephew (LSE:SN.) dominated a shortened risers board, while AstraZeneca (LSE:AZN) was just 74p lower at 10,950p after Deutsche Bank removed its “Sell” recommendation and Barclays upped its price target to 13,000p.
Car insurer Admiral Group (LSE:ADM) also got City backing as RBC Capital disclosed a new price estimate of 3,400p. Shares were 16p lower at 2,695p today.
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