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Thur City brief: Air strikes hit FTSE, UK retail sales up

UK stocks suffered a sharp jolt today following a steep sell-off on Wall Street as air strikes in Yemen overnight prompted a lift in oil prices. Brent rose 3.6% to $58.5 a barrel.

The FTSE100 fell 1.4% to 6,895.33, well down on its record close of 7,037.67 on Monday.

Leading the fallers was the London Stock Exchange Group after Dubai sold a £1.5 billion stake. There was also a disappointing update from budget airline easyJet.

US economic data also disappointed. Durable goods orders unexpectedly dropped 1.4% month-on-month in February.

There was better news from Greece where Economy Minister George Stathakis said he believed that the government would reach an agreement with the Eurozone’s finance ministers by “next week.”

UK retail sales rose at the fastest pace in three months in February, beating expectations and deflationary effects and suggesting the consumer-led economic recovery remains. sales rose 0.7%, their best growth since November and up from 0.1% in January, the Office for National Statistics said.

RBS fell after confirming it expects to make £2.5bn from the partial sale of shares in US subsidiary Citizens, while Lloyds declined after the government put more shares on the market by selling a stake worth £569m. It takes its holding below 22%.

Easyjet was lower despite upgrading guidance for the first half. It now anticipates a £20m favourable impact from currency movements, double its earlier guidance. As with other airlines, it was also hit by the higher oil price.

 

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