(CTN News) – On Wednesday, the FTSE 100 extended its early week selloff on the back of a stronger-than-expected inflation reading, which dampened expectations around sharp interest rate cuts this year, while disappointing data from China dented miners and energy majors.
A three-session losing streak for the blue-chip index had extended to a third consecutive session by 0807 GMT, and it had reached its lowest level in one and a half months.
While sterling edged up over the past few days, the FTSE 100 was continually pressured as data showed Britain’s annual rate of consumer price inflation rose for the first time in 10 months in December, with the rise being attributed to a hike in tobacco duty.
Investors were deterred from believing that the Bank of England Inflation will begin cutting rates in May thisas a result of the data released this week.
The market is pricing in a 50% chance of the central bank holding rates in May, according to traders.
Several energy and mining companies, such as Shell and Glencore, confirmed their stock prices were down due to weaker commodity prices, after data revealed that China’s inflation economy grew 5.2% in 2023, slightly above the official target, but it was a very shaky recovery compared to many analysts’ expectations.
Shares of Antofagasta, a Chilean copper miner listed on London’s Stock Exchange, fell 3.4% after the company reported a 2% rise in production forkept the output outlook for 2024 unchanged.
The share price of Pearson dropped 1.2% despite the fact that the company said it had met its guidance for the year 2023.
This week, the midcapFTSE 250 index fell 0.8% to reach a one-month low, the lowest level since June.