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FTSE 100 marks worst month in over a year on Omicron hit

Published 30/11/2021, 08:33
Updated 30/11/2021, 17:47
© Reuters. FILE PHOTO: A worker shelters from the rain under a Union Flag umbrella as he passes the London Stock Exchange in London, Britain, October 1, 2008.  REUTERS/Toby Melville/File Photo

© Reuters. FILE PHOTO: A worker shelters from the rain under a Union Flag umbrella as he passes the London Stock Exchange in London, Britain, October 1, 2008. REUTERS/Toby Melville/File Photo

By Bansari Mayur Kamdar and Ambar Warrick

(Reuters) - Britain's blue-chip share index closed above session lows on Tuesday, but marked its worst monthly decline in more than a year as concerns over the Omicron coronavirus variant hammered economically sensitive sectors.

The FTSE 100 fell 0.7% after dropping as much as 1.7% through the day. It shed more than 2% in November.

Most sectors in the FTSE 100 retreated. But mining stocks staged a late recovery, helping the index pare some losses as they tracked a jump in iron ore prices. [IRONORE/]

Prime Minister Boris Johnson said another lockdown was unlikely in light of the new variant, but would keep everything under review.

The domestically focussed mid-cap index fell 1.0%.

Global stock markets slumped after comments from vaccine maker Moderna (NASDAQ:MRNA)'s head that existing COVID-19 vaccines were unlikely to be as effective against the Omicron variant as they have been against the Delta version.

Drugmaker AstraZeneca (NASDAQ:AZN), which also makes COVID-19 vaccines, fell 1.1%.

British airline easyJet (LON:EZJ) slid 1.2% after reporting some softening of trading in its first quarter on COVID-19 outbreaks and the discovery of the Omicron variant. Broader travel and leisure stocks also sank.

"It almost feels like minus 10% for travel stocks is the new black," said Max Kettner, multi-asset strategist at HSBC.

"Sentiment around reopening stocks has hit absolutely rock bottom now and it's not just been a function of last Friday, but it has been a function of two or three months already."

© Reuters. FILE PHOTO: A worker shelters from the rain under a Union Flag umbrella as he passes the London Stock Exchange in London, Britain, October 1, 2008.  REUTERS/Toby Melville/File Photo

Meanwhile, data showed costs were rising at the fastest rate in over 20 years for firms in Britain's services sector, putting the Bank of England in a tough spot as they face rising inflation and economic risks at the same time.

The internationally focussed FTSE 100 has underperformed its domestic counterpart so far this year, gaining 8.3% compared with the 9.6% rise in the FTSE 250 index.

Latest comments

https://www.bloomberg.com/news/articles/2021-11-30/oxford-sees-no-evidence-omicron-defeats-covid-vaccines-so-far
yes total SS of a month
OMICRON is an anagram of MORONIC.... someone is playing a little joke...
I hate covid
A broken record .... 2 years the same .. Terrify 😨 to dead
I can see a pattern developing here, the existing vaccines are loosing there potency after 3 months, so big pharma want to blame the ineffectiveness of the vaccines on the new variants.
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