Latest News

Shell drags FTSE 100 lower on bigger Russia writedown


© Reuters. FILE PHOTO: Signage is seen outside the entrance of the London Stock Exchange in London, Britain. Aug 23, 2018. REUTERS/Peter Nicholls

By Sruthi Shankar

(Reuters) – Britain’s FTSE 100 slid on Thursday, lagging its continental peers, as oil major Shell (LON:RDSa) dropped after it flagged a bigger writedown following its decision to exit Russia.

The blue-chip index edged down 0.4% and the domestically focussed midcap index slipped 0.3%, while gains in defensive sectors propped up euro zone markets.

Shell fell 2.2% as it will write down up to $5 billion related to its Russia exit, more than previously disclosed.

Broadly, economy-linked sectors such as oil & gas, miners and banks declined on concerns about a slowdown in economic growth following hawkish signals from the U.S. Federal Reserve and due to the ongoing Ukraine conflict that has elevated inflation.

“The Fed minutes confirmed the feeling in markets, which was that 50 bp rate hikes were on the table and that quantitative tightening will begin in May even though the market believes economic growth will be impacted,” said Edward Park, chief investment officer at Brooks Macdonald Asset Management.

Another big decliner was housebuilder Countryside Properties, which tumbled 13.4% as it warned of lower annual profit after a business review flagged several issues, including costly expansions and manufacturing losses.

Overall, the sectoral index fell 2.1% after mortgage lender Halifax said British house prices grew strongly in March but the cost-of-living crisis clouded the outlook.

“We’ve got a fairly conservative view towards the housing sector. If we do see a turndown in consumer confidence, that will impact housing and if actually consumer demand remains quite robust and allows the BoE to carry on raising rates, that’s also going to be negative for house prices,” said Park.

Among gainers, 888 Holdings (LON:888) surged 25.7% after the gambling firm and U.S.-based Caesars Entertainment cut the deal value of William Hill’s non-U.S. assets, allowing a smaller equity raise to fund the deal.

Peer Entain (LON:ENT) slipped 1.9% even as it reported a surge in first-quarter total net gaming revenue.

Shell drags FTSE 100 lower after raising Russia writedown

EU’s full ban on Russian coal to be pushed back to mid-August -sources

Previous article

Alibaba Stock Deserves a Better Price Target, but It’s Still a ‘Sell,’ Says J.P. Morgan

Next article

You may also like


Leave a reply

Your email address will not be published. Required fields are marked *

More in Latest News