FTSE 100 Extends Losses Ahead BoE

The FTSE 100 Index is falling -160 points. Losses were driven by Endeavour (-6.04%), Antofagasta (-5.90%) and Fresnillo (-5.84%).

The FTSE 100 fell more than 1% on Thursday, extending the previous session’s 0.9% decline as the Iran conflict escalated following attacks on energy infrastructure in Iran and Qatar. Mining stocks led losses, with Fresnillo and Endeavour dropping over 5%, Antofagasta also down more than 5%, and Anglo American, Rio Tinto and Glencore falling between 2.5% and 4.6%. EasyJet lost 3.7%, while banks including HSBC, Lloyds and Barclays declined over 1.5%. In contrast, BP rose more than 1% and Babcock gained around 2%. Investors await the Bank of England decision later today, which comes after the Federal Reserve signaled no near-term rate cuts. Meanwhile, UK data showed softer wage growth and steady unemployment at 5.2%, but markets are focused on surging energy costs, with European gas up around 30% and Brent nearing $117, increasing inflation risks.

The FTSE 100 closed 0.9% lower at 10,305 on Wednesday on losses for fast-moving consumer goods and utility providers ahead of the Bank of England's policy decision tomorrow. Severn Trent, United Utilities, and National Grid closed over 2% lower to track the pessimistic sentiment for the sector across Europe, pressured by another surge in natural gas prices following strikes on Iranian gas processing plants, while major European governments met to discuss. Meanwhile, Unilever fell 3.5% after announcing it is considering separating its food assets from the main conglomerate. Coca Cola and British American Tobacco also fell over 3%. The BoE is expected to hold its rates unchanged tomorrow, aligned with decisions from other G10 banks as policymakers will remain cautious to decisions on an uncertain macroeconomic environment due to the war. Pro-inflationary risks clash with signs of a weaker labor market, with the unemployment rate expected to rise to 5.3% in February.