UK's FTSE 100 edges lower on Omicron fears, downbeat GDP data

[MongiIG]

UK's FTSE 100 edges lower on Omicron fears, downbeat GDP data

Stock MarketsDec 22, 2021

(Reuters) -UK's FTSE 100 inched lower on Wednesday on mounting concerns over the impact of the Omicron coronavirus variant on economic recovery and weaker-than-expected quarterly growth data.

The blue-chip FTSE 100 index fell 0.2%, while the domestically focussed mid-cap index added 0.3%.

Miners declined 0.7%, with Rio Tinto (LON:RIO) Plc leading the fall as benchmark Dalian and Singapore iron ore futures fell amid concerns over COVID-19 curbs in China.[IRONORE/]

Data showed Britain's economy grew slower than expected in the July-September period, before the Omicron variant posed a threat to economic recovery.

"The chances of (FTSE 100) surpassing 7,500 in the remaining sessions have categorically lessened as subdued macroeconomic data is likely to fuel the jittery (sentiment)," said Kunal Sawhney, chief executive officer at Kalkine Group, adding that investors could be on a lookout for bargain deals.

Prime Minister Boris Johnson said on Tuesday that he would not be introducing new COVID-19 restrictions in England before Christmas.

Britain on Tuesday also announced 1 billion pounds ($1.3 billion) of additional support for businesses hit hardest by the wave of Omicron cases, with hospitality and leisure businesses eligible for grants of up to 6,000 pounds for each of their premises.

"In this busy period and run up to Christmas, this doesn't seem like a huge amount," said Bethany Beckett, UK Economist at Capital Economics.

 

The UK travel and leisure sector is among the worst performers this year, down 8.8% so far this year, compared with a near 26% rise in commodity stocks including energy and industrial metal miners.

Healthcare investment firm Syncona Ltd jumped 8.0% after saying that Swiss drugmaker Novartis AG is buying its Gyroscope Therapeutics for up to $1.5 billion.