- UK mid-caps to record worst week since October 2020
- AO World slumps as supply chain disruptions weigh
- Software provider Sage to cut 800 jobs globally
- FTSE 100 down 1.0%, FTSE 250 off 0.3%
Oct 1 (Reuters) – British mid-cap stocks closed two-month lows on Friday, as warnings from electrical goods retailer AO World and pub operator J D Wetherspoon stoked concerns around supply chain disruptions and higher energy prices.
The blue-chip FTSE 100 index (.FTSE) lost 1.0% as a stronger pound pressured the dollar earners on the index.
“In the United Kingdom, there has been an alarming drop in business confidence in the space of a month, with the optimism engendered by the vaccine roll-out feeling like a distant memory amid a fuel, supply chain and cost of living crisis,” said Russ Mould, investment director at AJ Bell.
For the year so far, the FTSE 100 is up nearly 9% and the mid-cap FTSE 250 index 11%, on support from re-opening optimism and easy central bank policies.
However, a rise in cost pressures from supply chain disruptions and higher energy prices have weighed on UK’s economy, putting the mid-cap index on track to post its fourth consecutive weekly decline.
There is going to be some further economic recovery and some further gains in equity markets, but from now on, gains will be relatively small as the recovery pace in the United States and China is expected to slow, said Franziska Palmas, market economist at Capital Economics.
Reporting by Bansari Mayur Kamdar and Amal S; Editing by Sriraj Kalluvila and Uttaresh.V
Our Standards: The Thomson Reuters Trust Principles.