FTSE 100 down as M&S slumps on Ocado deal rights issue

British blue-chip stocks fell again on Wednesday as Marks & Spencer tumbled after announcing a rights issue to fund an online food joint venture with Ocado, while plans for a cash call knocked Metro Bank to an all-time low.

The main index was 0.6 percent lower by 0825 GMT while the midcap index was down 0.4 percent.

M&S slumped as much as 10 percent and was on course for its steepest one-day decline in more than two and a half years.

But Ocado added 5 percent as M&S said it would pay 750 million pounds to own half of the online grocer's UK retail business.

The blue-chip bourse, which earns a major chunk of its earnings in dollars, was also dragged down by a stronger pound. Sterling had rallied in the previous sessions as hopes grew that Brexit maybe delayed.

Midcaps saw some big fallers too, with Metro Bank tanking 20 percent a day after it disclosed that regulators were looking to investigate the circumstances around an accounting error at the lender.

Metro Bank also announced plans for a 350 million pounds shareholder cash call on Tuesday.

Fashion retailer Ted Baker slid 14 percent after it forecast lower earnings for the year, blaming the impact of foreign exchange rates, higher costs to upgrade its systems and inventory write-downs.

Rio Tinto outperformed with a 2 percent rise after it announced a special dividend and reported a better-than-expected earnings for the year.

Taylor Wimpey, Britain's third-largest homebuilder, added 1.3 percent after it said demand for its homes remained strong at the start of the year.

On the FTSE 250, gambling software maker Playtech rose 4 percent after inking a deal with GVC to provide its services and products to GVC brands.