London plunges | travel boost for services sector
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5pm: Market plunges
The FTSE 100 fell 207.18 points (2.86%) to close at 7,025.47 as growing recession risks sent shockwaves around global equity markets.
In Paris the CAC 40 ended down 2.7%, while the DAX 40 in Frankfurt ended down 2.9%.
Energy stocks ended among the worst performers, tracking spot oil prices lower. BP closed down 7.2%, Shell down 8.7% and Harbour Energy down 9.6%.
Sainsbury’s closed up 1.3% even as the supermarket chain posted a slip in first quarter sales (see below)
Brent oil was quoted at $105.18 a barrel at the equities close, sharply lower from $113.66 at the close Monday.
Stocks in New York were in the red at the London equities close. The Dow Jones was down 2.2%, the S&P 500 index down 1.9% and the Nasdaq Composite down 1.0%.
On Wall Street, Tesla fell 3.6% after Elon Musk’s electric vehicle maker reported disappointing second-quarter deliveries.
11am: Services sector rises
A rebound last month in the UK’s services sector, which was stronger than expected, was largely because of increased spending on travel and leisure.
The S&P Global/CIPS purchasing managers’ index (PMI) rose to 54.3 last month from 53.4 in May, showing the sector has expanded for the 16th consecutive month. A figure above 50 indicates growth.
The latest measure could point to the economy contracting by less than expected in the second quarter, say economists, though there are higher energy and tax prices to be priced in to consumer spending behaviour over the coming weeks.
9.30am: London turns lower
After an initial rise, the FTSE 100 has turned down, trading at 7,182.08 (-50.57 points) as miners dragged the market lower on recession worries.
7am: Quiz Clothing returns to profitability
Fashion brand Quiz Clothing showed a strong return to growth after posting an £800,000 underlying profit for the year to the end of March (2021: £9.6m loss).
Group revenue increased 97% year on year to £78.4m (2021: £39.7m) following the removal of social restrictions.
7am: Sainsbury’s Q1 sales fall
Supermarket group Sainsbury’s posted a 4% fall in underlying sales in its first quarter, driven by weakness in general merchandise as consumers became more discretionary in their spending.
The company said its outlook for the full year was unchanged.
After six years as chief financial officer, Kevin O’Byrne has confirmed his intention to retire from Sainsbury’s at the end of this financial year, in March 2023.
7am: Car sales plummet
Car sales suffered their worst June figures since 1996 as registrations of new vehicles plummeted about 24% compared with June 2021, according to preliminary figures from the Society of Motor Manufacturers and Traders (SMMT).
Manufacturers have had problems fulfilling orders due to global shortages of semiconductors, the trade body said. Drivers are facing wait times of more than a year for some models.
During the first half of 2022, only about 800,000 new cars were sold, a 12% fall compared with the same period last year. This is the industry’s second weakest performance from January to June since 1992.
In Tokyo, the Nikkei 225 was 1.0% higher in late trade. In China, the Shanghai Composite was 0.7% lower, while the Hang Seng in Hong was flat. Wall Street was closed for Independence Day.
The pound was trading at $1.2115 early Tuesday, largely unchanged from $1.2114 late Monday.
Brent oil was quoted at $113.22 a barrel, down a touch from $113.66.