Warnings by homebuilders knock FTSE

London’s blue-chip index ended the day in the red, dragged down by declines from house - builders, Sainsbury’s and Barclays stocks.

T h e F T S E 10 0 d r op p e d 3 7.62 p to c l o s e a t 7,434.13p.

“A warning on margins from Taylor Wimpey and news that the Sainsbury-asda merger was off saw the FTSE fall sharply on the open,” said City Index senior analyst Fiona Cincotta.

Sainsbury’s slid 10.6p to 216p – its lowest share price in 16 years – after its proposed £12 billion merger with Asda was blocked by the competition watchdog.

The Competition and Markets Authority said the deal would lead to increased prices for UK customers.

There was a slump across the blue-chip housebuilders after FTSE 100-listed Taylor Wimpey warned that it was costing more to build homes. Shares sank 10.3p to 181.95p after it said profit margins for the full year would be lower than expected due to rising building costs.

Industr y peers Persimmon, Barratt and Berkeley were also impacted, falling in value during the day’s trading.

Meanwhile RBS saw shares decline after boss Ross Mcewan announced his resignation from the helm of the taxpayer-owned bank.

The news came ahead of the bank’s AGM, where bosses warned that the lender could face a Brexit hit as uncertainty weighs on the economy. It closed down 6.7p at 250p.

Barclays shares also slipped after it disclosed a 10 per cent drop in first quarter profits and warned it may need to slash costs further during the year. It finished 6p lower at 160.4p.