LONDON: Britain's top share index slid lower on Tuesday, weighed down by airline easyJet as a global bond sell-off hit markets and ensured that optimism after a decisive British election was short-lived.
The blue-chip FTSE 100 index fell 1.4 percent to 6,933.80 points. The FTSE hit a record high of 7,122.74 points last month and remains up around 6 percent since the start of 2015, having risen sharply at the end of last week after the Conservative Party won an outright majority in the election.
Shares in easyJet slumped 9.8 percent, the worst performer on the FTSE 100. Air traffic control strikes hit the company's profits in April, hurting its broader outlook.
Among stocks gaining ground, credit data company Experian rose 3.1 percent after the company forecast stable margins, despite reporting lower profits.
Lloyds also edged up after Britain sold another 500 million pounds ($784 million) of shares in the bank.
Nav Banwait, chief market strategist at Thames Capital Markets, said the longer-term outlook for the FTSE was positive, with the market helped by signs of a British economic recovery such as data on Tuesday that showed that industrial output grew at its fastest rate in six months in March.
However, he added that unease in financial markets caused by the bond market sell off could hit the FTSE in the near-term.
"We're anticipating a move down to 6,900 points, but we will be looking to cautiously buy into the market here as we expect the FTSE back up at 7,100 points in the next two weeks," he said.
Others were more cautious due to the bond market jitters.
"I'm looking for a 5 to 10 percent correction over the next month or two," said Horizon Stockbroking director Kyri Kangellaris.
Comments
Comments are closed for this article.