FTSE slips after glum GDP data, but set for weekly gains
By Bansari Mayur Kamdar
(Reuters) -UK’s FTSE 100 slipped for a third straight session on Friday after data pointed to stalling economic growth in Britain, even before the emergence of the Omicron coronavirus variant, and as investors remained cautious ahead of U.S. inflation numbers.
The main index was still on course for its biggest weekly gain in eight months, boosted by a strong recovery in mining stocks, which are up nearly 6% for the week.
“We’re seeing a flight to safety with defensive names like British American Tobacco on the front foot,” said Justin McQueen, market analyst at DailyFX.
“The sort of news around Omicron and the government announcing its plan B and suggestions around plan C does put the final nail in the coffin for a rate rise next week.”
Data showed Britain’s economy grew by a weaker-than-expected 0.1% in October, leaving it 0.5% smaller than it was in February 2020, just before the country went into its first COVID-19 lockdown.
The numbers further raised doubts about a December rate hike after Prime Minister Boris Johnson recently announced a new coronavirus Plan B ordering people to work from home, wear masks in public places and use vaccine passes.
Capping losses on the main index, miners gained 0.5% tracking copper prices, and defensive stocks such as consumer staples, which tend to be less sensitive to the economic climate, also rose. [MET/L]
British American Tobacco gained nearly 2% after a Wall Street Journal report that said the U.S. Senate was dropping a proposal to impose higher taxes on vaping, oral nicotine and other NGPs.
The domestically focussed mid-cap index fell 0.4%, after Ashmore Group dropped 4.4% as Goldman Sachs downgraded the asset manager to “neutral”.
(Reporting by Bansari Mayur Kamdar in Bengaluru; Editing by Subhranshu Sahu and Amy Caren Daniel)