By Jack Barnett
London’s FTSE 100 was dragged down today by companies that will likely suffer amid additional rail strikes over Christmas.
The capital’s premier index dropped 0.61 per cent to 7,521.39 points, while the domestically-focused mid-cap FTSE 250 index, which is more aligned with the health of the UK economy, fell 1.19 per cent to 19,100.08 points.
Leisure and hospitality companies that book a large chunk of their annual income over the festive trading period fell sharply in the City today after the RMT union announced further strikes starting on Christmas Eve and running through to 27 December.
Pub giants and FTSE 250 listed JD Wetherspoon and Mitchells and Butlers shed 2.54 per cent and 1.93 per cent respectively.
“UK investors haven’t found much of anything to set London markets on a different course. News of further train strikes over Christmas aren’t exactly filling the hospitality sector with festive cheer,” Danni Hewson, financial market analyst at AJ Bell, said.
Investors have also been jittery in recent weeks due to fluctuating judgements on how high central banks will hike interest rates.
Most expect the US Federal Reserve and Bank of England to slow to 50 basis point rises next week, but the eventual peak could be higher than previously expected.
Higher rates hit stocks by making bonds more attractive and knocking the value of companies’ future earnings.
The pound was flat against the US dollar today.
UK borrowing costs slipped lower.
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