Britain’s blue-chip stock index fell to a near three-week low on Tuesday, dragged down by commodity-linked shares and Ashtead Group, while telecommunications testing firm Spirent surged nearly 60% following a buyout deal.
The FTSE 100 slipped 0.3% to touch its lowest level since Feb. 16.
Shares of commodity majors such as BP, Shell and Glencore fell about a percent each as oil and metal prices dipped after pledges by China to transform its economy amid stuttering growth since the COVID pandemic failed to impress investors.
British equipment rental firm Ashtead dropped 7.8%, falling the most among FTSE 100 components, after it forecast full-year group rental revenue at the lower end of 11%-13% growth range.
Weighing on the mood further was a survey that showed British consumer spending slid in February, as bad weather kept shoppers at home and households remained cautious about spending in the face of high borrowing costs and inflation.
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“The pain felt by non-food volumes continues, as consumers continue to prioritise the essentials,” said Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown.
“While volumes at food stores are painting a better story, the path to improved profits isn’t a given, as lower price inflation takes the wind out of sails.”
Finance minister Jeremy Hunt, who has so far played down speculation of big pre-election tax cuts, is due to deliver his Spring Statement on Wednesday.
The mid-cap FTSE 250 index edged up 0.1%.
Shares of Spirent Communications looked set for their best day in more than two decades after US-based communications equipment firm Viavi Solutions Inc agreed to buy the British firm in a deal valued at about 1.01 billion pounds ($1.28 billion).
Inchcape fell 8.8% after the automotive distributor tempered its growth outlook for the short term, saying demand in certain markets was weaker than in the previous years.
Global office rental firm IWG dropped 5.8% and struck a cautious tone on outlook after reporting a 34% jump in annual core profit.
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