Travel and retail firms slump as IAG reveals losses
TRAVEL and retail stocks slumped as concerns over weakening consumer demand weighed down on the FTSE.
A heavy loss for British Airways owner International Airways Group (IAG) helped pull a number of major travel and leisure firms into the red.
The company closed at the foot of the FTSE 100, finishing 12p lower at 131.44p, as bosses revealed a £916 million loss for the past year.
The FTSE 100 ended the day down 115.33 points, or 1.54 per cent, at 7,387.94 points.
Michael Hewson, chief market analyst at CMC Markets UK, said: “European markets have ended the week very much on a downswing as yesterday’s big sell-off in the US has rippled over into today’s price action, pulling markets into negative territory for the week, with the Dax set to finish lower for the fifth week in a row.
“The FTSE 100 has also had a disappointing week, sliding to a one-week low, with the energy sector saving it from a worse fate, with both BP and Shell finishing the week very much on the front foot, after their strong numbers earlier this week.
“Today’s price action has been dominated by weakness in consumer discretionary on concerns over weak demand as higher prices prompt a decline in consumer spending.”
The French Cac was down 1.73% and the German Dax decreased 1.64% by the end of the session. Across the Atlantic, the US markets continued their sell-off following the interest rate rise, dipping further despite a positive non-farm payrolls report. Meanwhile, sterling edged marginally higher in minor rebound following weak economic projections on Thursday.
The pound increased by 0.03% against the dollar to 1.235, and lifted 0.08% against the euro to 1.168.
S4 Capital shares made gains after the advertising agency reported its revenue doubled in 2021 in its heavily delayed final results.
Sir Martin Sorrell apologised for the “unacceptable and embarrassing” delay, which had originally knocked the firm’s share value last month. Shares rose 31.8p to 357.8p.
Smiths News slipped during the session after major customer Mccoll’s tumbled into administration. Shares fell 28p to 1,482.5p after the group, which supplies magazines and newspapers to around 600 Mccoll’s stores, said it has a bad debt risk of between £6 million and £7m in relation to Mccoll’s.
Insurer Beazley finished in the green after it said overall premiums grew 27% in the first three months of the year, with strong growth in its cyber division. Shares moved 23.8p higher to 430.2p.
The price of oil bounced again as the EU embargo on oil imports drove it higher. Brent crude increased by 1.91% to $113.02 per barrel when London closed.
The biggest risers on the FTSE 100 were Hikma Pharmaceuticals, up 45.5p to 1,731p; BP, up 7.75p to 426.65p; Mondi, up 22.5p to 1,589p; Endeavour Mining, up 28p to 2,050p, and Admiral Group, up 24p to 336.6p.
The biggest fallers were IAG, down 12p to 131.44p; Rightmove, down 46p to 558.8p; Segro, 79p to 1,109p; and Aveva, 150p to 2,144p.