Title: London shares fall as energy stocks weigh
Aug 05, 2022 04:20AM ET
UK shares fell on Friday, with energy stocks leading the declines, a day after the Bank of England raised interest rates by the most in 27 years.
The FTSE 100 index dipped 0.1%, while the midcaps index edged 0.1% higher.
The FTSE 100 index ended flat on Thursday after the British central bank's Monetary Policy Committee raised its Bank Rate by a half percentage point to 1.75% - the highest level since late-2008.
UK stocks initially reacted positively to the move, which was seen as BoE's effort to rein in inflation in the British economy and as the sterling weakened, but fears crept in after the central bank warned of a long recession looming.
Central banks generally tend to soft soap when it comes to bad news, however the frankness behind the BoE's economic assessment was as dark as it could be
Still, London stocks have performed better than their global peers so far this year, with the FTSE 100 index now on track for its third straight week of gains.
Oil majors Shel Plc and BP Plc fell more than 1% each, weighing the most on the blue-chip UK index.
WPP the world's largest advertising group, increased its annual net sales outlook, but its shares fell 7.6% in early trading.
The London Stock Exchange Group (LON:LSEG) rose 3.5% after it said its costs and savings targets for integrating its $27 billion acquisition of data company Refinitiv remain unchanged, and that it was launching a 750 million pound ($910.65 million) share buyback.
Investors across the globe now await the release of U.S. jobs data, to see whether the Federal Reserve's aggressive pace of rate hikes is slowing growth in the world's largest economy.