U.K. stocks ended Thursday’s session in negative territory, amid a global risk-off shift and further declines in the oil price, which weighed on London-listed commodity stocks.
Meanwhile, the Bank of England left interest rates unchanged but stressed risks surrounding global growth and Brexit, just one day after the Federal Reserve raised rates by 25 basis points but pared down its expectations for further hikes in 2019.
How are the markets performing
The FTSE 100 UKX, -0.80% closed 0.8% lower at 6,711.93, after climbing 1% on Wednesday.
What is driving markets?
Wednesday’s decision by the Federal Reserve to raise interest rates for a fourth time this year while lowering its expectations for further hikes and highlighting risks led to a global risk-off move across financial markets on Thursday.
“The Fed showed no indication that they were prepared to rein back the pace of balance sheet reduction, and while they lowered their estimates for rate rises next year to two from three, it was almost as if they were offering a tin ear to market concerns,” Michael Hewson, chief market analyst at CMC Markets UK, wrote in a note to clients.
Meanwhile, the Bank of England left interest rates unchanged, as expected. However, it warned that since its last meeting, “the near-term outlook for global growth has softened and downside risks to growth have increased.”
U.K. retail sales figures for November sales were positive, rebounding strongly to 1.4%, the best monthly performance since April’s 1.6% rise.
In the pharmaceutical sector, Major drug makers reportedly plan to hike prices of their drugs in the U.S. in January, according to a Reuters report.
What stocks are active?
Airline stocks dropped after U.K. airport London Gatwick shut down late Wednesday, amid reports that two drones were flying above the airfield led to a formal investigation. Ryanair RY4C, +1.27% ended 2.3% lower.
Pharmaceutical companies, which earlier led gainers, reversed their wins. GlaxoSmithKline PLC GSK, -0.19% closed 0.2% lower, and AstraZeneca PLC AZN, -0.37% fell 0.4%. Biotechnology company Shire PLC SHP, +1.33% was one of the biggest gainers in the session and held on to its gains, closing up 1.3%.
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