LONDON, July 31 ― Gloomy quarterly results from banks and a clutch of other firms saw the FTSE 100 post its worst session in five weeks yesterday, while uncertainty about US elections and a collapse in economic growth in the world's largest economy also weighed.
Global sentiment took a hit as a 32.9 per cent plunge in US second quarter economic growth, albeit lesser than expected, and a tweet from US President Donald Trump about possibly delaying November elections unnerved markets.
“There's already heightened uncertainty around the election ... and the potential for a fiscal policy regime change. This just adds to that uncertainty,” said Phil Orlando, chief equity market strategist, at Federated Hermes in New York.
The blue-chip FTSE 100 ended 2.3 per cent lower on broad-based losses, with Lloyds Banking Group sliding 7.6 per cent to an eight-year low after swinging to a rare pre-tax loss in the first half of 2020.
Standard Chartered tumbled 6.2 per cent as the lender posted a 33 per cent slump in first-half profit after a six-fold jump in credit impairment charges.
The mid-cap FTSE 250 slipped 1.3 per cent, led by a 12 per cent fall for car dealer Inchcape as impairment charges pushed it to losses.
The export-laden FTSE 100 is on track to record monthly declines in July after rallying since April as faltering economic data and surging Covid-19 cases have dented optimism over a swift post-pandemic economic recovery.
Oil majors BP and Royal Dutch Shell lost 3.6 per cent and 5.5 per cent as crude prices fell on fears that more Covid-19 containment measures could hurt demand.
London shares of travel company TUI slipped after it said it will shut 166 stores in the UK and Ireland due to the downturn in travel caused by the coronavirus ― a move that will lead to more losses in the battered sector.
AstraZeneca, meanwhile, rose 1.6 per cent on an upbeat second quarter and reiteration of 2020 forecasts, while defence company BAE Systems jumped after announcing plans to restart dividend payouts. ― Reuters
