Yorkshire Post

Fed decision sees the FTSE end the week on a low note

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GLOBAL markets closed the session lower after sell-offs in the US and Asia started Friday trading on the back foot.

The FTSE 100 dropped to its lowest level in almost a fortnight as weak sentiment was compounded by the Federal Reserve decision not to extend the supplement­ary leverage ratio - a mechanism that requires US banks to hold less capital reserves so they can free up cash to inject into the economy with loans.

Traders continued to flog stocks as they took the view that if banks are more restricted with capital requiremen­ts it could thwart the economic recovery.

London’s top flight closed 70.97 points, or 1.05%, lower at 6,708.71 on Friday.

Connor Campbell, financial analyst at Spreadex, said: “Announcing it would be allowing the pandemic-prompted changes to the supplement­ary leverage ratio for banks to expire at the end of the month, the Fed undid any goodwill it generated following Wednesday evening’s meeting.

“This worsened what was already a rough session in Europe.

“Even with the pound down against the dollar and 0.3% lower against the euro, the FTSE found itself eating a loss.’’

In the US markets, the Fed announceme­nt and traders backing the dollar saw the Dow Jones dive by 330 points on the bell with the major investment banks heavily dragging on the index.

In continenta­l Europe, the major markets also suffered heavy falls, with the German

Dax losing most of its gains from earlier in the week.

The German Dax decreased by 1.05% and the French Cac moved 1.07% lower.

Meanwhile, sterling dropped against a stronger dollar and euro as reports of a slowdown in

UK vaccinatio­ns in the coming weeks also weighed on the currency.

The pound decreased by 0.36% versus the US dollar to 1.387 and was down 0.33% against the euro at 1.165.

In company news, Wetherspoo­ns

slid into the red after the pub giant registered a heavy drop in its sales and sustained heavy losses in its last six-month period.

Revenue dropped by nearly 54% to £431m in the half year to the end of January, even as pubs were allowed to reopen, albeit under restrictio­ns, for part of that time.

Shares were 31p lower at 1,289p at the end of the day on Friday as a result.

Elsewhere, Natwest moved marginally higher after the Government announced its latest sell-off of its stake in the bank, in a move worth £1.1b for the taxpayer.

Shares moved 0.9p higher at 191.4p.

Housebuild­ers Taylor Wimpey and Countrysid­e both slid lower after the UK competitio­n watchdog said they could be breaking the law if they continue to include deeply unfair ground rent terms in contracts for new homes.

The price of oil moved higher, recouping much of its losses from Thursday, driven by bargain-hunting from global traders.

The price of Brent crude oil increased by 2.1% to 64.61 dollars per barrel.

The biggest risers on the FTSE 100 were Ocado, up 42p at 2,022p, Sainsbury’s, up 3.8p at 244.8p, National Grid, up 13p at 842p, and DCC, up 94p at 6,246p.

The biggest fallers on the FTSE 100 were Rolls-Royce, down 7.55p at 117p, IAG, down 9.1p at 206.7p, BT Group, down 5.95p at 145.35p, and Burberry, down 79p at 2,035p.

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