LONDON, April 25 ― London's FTSE 100 racked up losses for the second consecutive week yesterday, weighed down by falling oil majors BP and Shell while retail sales data showed the scale of the economic fallout from the coronavirus crisis.
A report that Gilead Sciences Inc's closely-watched experimental antiviral drug failed to help patients with severe Covid-19 in a clinical trial clouded sentiment globally.
The blue-chip FTSE 100 index ended 1.3 per cent lower, logging a 0.6 per cent decline for the week marred by a historic plunge in oil prices. Shares of BP Plc and Royal Dutch Shell were down nearly 3 per cent.
The domestically-focused FTSE 250 index slipped 0.7 per cent.
Official figures on Friday showed UK retail sales suffered a record sales hit in March, while consumer confidence held at its lowest since 2009 as thousands of businesses and the vast majority of shops were closed.
Trillions of dollars in stimulus measures from central banks and governments worldwide, along with some easing of lockdown restrictions, has helped the FTSE 100 recover from mid-March lows, but it still stands nearly 25 per cent below its January peak.
“The feeling is we've had a bear market rally,” said Keith Temperton, a sales trader at Tavira Securities.
“We're cautious into next week. We have fairly important things coming out on the economic front (and) ... I imagine that the market will struggle to absorb the bad data.”
Luxury brand Burberry fell 3.6 per cent after saying it would not tap Britain's state furlough scheme and would pay its employees who are unable to work because of store or site closures during the coronavirus crisis.
Education group Pearson dropped 4.1 per cent after it posted a 5 per cent fall in quarterly revenue and warned of a bigger hit if social distancing measures are prolonged.
In a bright spot were homebuilders after Persimmon said it would restart its construction sites in a phased manner from Monday, making it the third company in the sector this week to announce such a move.
Berkeley, Barratt and Taylor Wimpey gained between 0.4 per cent and 2.5 per cent.
“Such signs of normality returning will be a key pillar of the government's strategy, bolstering consumer confidence, although any measures will be quickly rescinded if it looks like the outbreak is returning,” said Chris Beauchamp, chief market analyst at IG in London.
Major European lenders including HSBC and Standard Chartered report results next week where the borrowers are expected to post a sharp rise in provisions against bad loans as they struggle amid the economic downturn. ― Reuters
