London close: Stocks sink sharply as risk appetite scaled back

The UK stock market suffered a sharp sell-off on Thursday, dropping to its lowest level in over a week, as geopolitical and macroeconomic fears hammered investor sentiment.

The FTSE 100 finished down 1.37% at 6,895.33, as it continues to retreat from a record closing high of 7,037.67 reached on Monday. The index has not closed below the 6,900 mark since 17 March.

Financial, airline and mining stocks were among the worst performers by the end of the session as investors scaled back their appetite for risk, with just three companies on the Footsie finishing with gains.

Airline stocks in particular were feeling the brunt of a spike in the price of oil after Saudi Arabia launched air strikes in Yemen overnight in an effort to defeat rebel Houthi fighters from the north. Brent was up 4% at $58.71 a barrel by afternoon trade, as a widening conflict in that Gulf country could pose risks for global oil supplies.

Markets were also digesting news that Greece had failed in a bid on Wednesday to secure a quick cash payment from the Eurozone bank bailout fund to help stave off potential bankruptcy next month.

Economic data was mostly positive on Thursday with UK retail sales rising a seasonally adjusted 0.7% in February and German consumer confidence improving more than expected.

US jobless claims also fell more than predicted to a five-week low, though that didn't stop stocks falling on Wall Street after the opening bell. "Investors took this strong jobs figure as a boost to the hawks in the Fed," said analyst Connor Campbell from Spreadex.

LSEG leads fallers

Shares in London Stock Exchange Group dropped sharply after Borse Dubai offloaded 60m shares in the exchange operator, equal to a 17.4% stake worth £1.5bn.

Other financials such as Hargreaves Lansdown, St James's Place and Aviva were also in the red. Schroders and Prudential were registering losses after going ex-dividend, along with real estate group British Land.

Oil and gas stocks, which traded higher early on, couldn't hold on to gains despite the spike in the oil price with Shell among the fallers after doubling its planned job cuts at its North Sea operations. BP and BG Group finished owe, along with mining peers BHP Billiton, Anglo American and Rio Tinto.

The jump in oil, however, was having an effect on travel stocks with Easyjet falling sharply even though it lifted its guidance for the first half. The company said it could now make a small profit in the first six months of the year, compared with previous expectations of a £10m-30m loss.

Airline peers IAG, Wizzair and Dart were also out of favour.

Banks were also under the weather: RBS fell after confirming it expects to make at least $3.2bn from the partial sale of shares in US subsidiary Citizens, while Lloyds declined after the government sold a stake worth £569m in the lender.

Market Movers
techMARK 3,176.41 -1.27%
FTSE 100 6,895.33 -1.37%
FTSE 250 17,260.56 -1.38%

FTSE 100 - Risers
Weir Group (WEIR) 1,777.00p +0.51%
Hikma Pharmaceuticals (HIK) 2,194.00p +0.46%
Randgold Resources Ltd. (RRS) 4,902.00p +0.41%

FTSE 100 - Fallers
London Stock Exchange Group (LSE) 2,395.00p -5.63%
ARM Holdings (ARM) 1,080.00p -4.17%
Schroders (SDR) 3,207.00p -4.07%
St James's Place (STJ) 945.00p -3.47%
Hargreaves Lansdown (HL.) 1,166.00p -3.40%
International Consolidated Airlines Group SA (CDI) (IAG) 587.00p -3.37%
Prudential (PRU) 1,685.00p -3.27%
Direct Line Insurance Group (DLG) 320.30p -2.94%
RSA Insurance Group (RSA) 424.40p -2.93%
Dixons Carphone (DC.) 418.40p -2.83%

FTSE 250 - Risers
Supergroup (SGP) 991.00p +6.16%
Just Eat (JE.) 408.70p +5.34%
Card Factory (CARD) 292.30p +2.89%
Ophir Energy (OPHR) 141.30p +1.80%
AA (AA.) 431.80p +1.55%
Greggs (GRG) 1,035.00p +1.47%
COLT Group SA (COLT) 142.00p +1.00%
Hunting (HTG) 539.50p +0.94%
Infinis Energy (INFI) 191.70p +0.89%
Cranswick (CWK) 1,404.00p +0.86%

FTSE 250 - Fallers
Bodycote (BOY) 729.50p -5.14%
Ladbrokes (LAD) 104.10p -5.10%
BlackRock World Mining Trust (BRWM) 306.00p -4.32%
Phoenix Group Holdings (DI) (PHNX) 845.00p -4.30%
Serco Group (SRP) 174.00p -4.29%
Entertainment One Limited (ETO) 310.10p -4.02%
Euromoney Institutional Investor (ERM) 1,086.00p -3.89%
Workspace Group (WKP) 854.00p -3.88%
Booker Group (BOK) 149.60p -3.86%
Centamin (DI) (CEY) 57.90p -3.82%