FTSE 100 Falls by Over 1%

The FTSE 100 dropped more than 1% on Thursday, with sentiment subdued after the Bank of England voted 7-2 to maintain interest rates at 3.75%. The index was dragged lower by weakness in energy and mining stocks as commodity prices continued to fall. Shell and BP lost more than 1.5%, Rio Tinto was down 2.3%, Glencore fell 2.4% and Anglo American slipped 3.2%. Tesco also weighed on the index, falling more than 1.5% after first quarter sales growth missed expectations. A number of stocks traded ex-dividend, including Persimmon, Land Securities and 3i Group. The BoE held its base rate at 3.75% at the June meeting, with two members voting for a 25-basis-point increase, matching expectations, and reiterated that it is monitoring geopolitical risks while remaining focused on returning inflation to its 2% target. The Federal Reserve also kept rates unchanged, although nine of its 19 policymakers now anticipate at least one rate hike this year.

The FTSE 100 traded 0.5% lower on Thursday after two sessions of gains, weighed down by weakness in oil companies and miners. Shell and BP fell more than 1% as oil prices extended their declines, while weaker base metal prices dragged on mining stocks, with Rio Tinto down 1.6%, Glencore falling 1.6% and Anglo American declining 2%. Tesco shares dropped more than 2% after weaker-than-expected sales growth in the first quarter, with the retailer blaming part of the slowdown on adverse weather. UK comparable sales rose 1.8% in the three months to the end of May, below forecasts of 2.7%. Several stocks also traded ex-dividend, including Persimmon, Land Securities and 3i Group. Focus now turns to the Bank of England’s rate decision after stronger-than-expected jobs data. The BoE is expected to hold rates steady as inflation pressures ease and energy prices fall. The Federal Reserve also kept rates unchanged, though nine of 19 policymakers now expect at least one rate hike this year.

The FTSE 100 Index is losing 54 points. Losses were led by London Stock Exchange (-3.66%), Fresnillo (-2.99%) and Entain (-2.75%). Offsetting the fall, top gainers were Melrose (3.02%), Informa (2.31%) and International Airlines Group (0.95%).