Shell knocks FTSE lower

The internationally focused FTSE 100 fell 3.5%, with the energy sector proving the biggest drag, taking 65 points off the index.

Shares in rival BP, which said it was maintaining its dividend earlier this week, fell 6%. Shell also suspended share buybacks and said it would reduce output by about a quarter, hit by a slump in oil demand due to tight lockdown measures.

Markets across the globe took a breather on Thursday after a recent run of gains that helped the FTSE 100 post its biggest monthly gain since April 2018 with a 4% rise.

The FTSE midcap index, down 2.3% on the day, still recorded its biggest monthly gain since 2010.

Lloyds Banking Group fell 7.3% as its first quarter pretax profit was wiped out by provisions against expected bad loans due to the pandemic.

Miner and trader Glencore dropped 5% after it cut its 2020 capital expenditure and output targets to reflect the impact of the coronavirus on its operations.

Supermarket group Sainsbury's also fell 5% after it warned of a hit from coronavirus-related costs and said it would defer dividend payment decisions until later in the year.

Among the gainers, Reckitt Benckiser rose 3.6% after it forecast performance in 2020 to be better than initially thought and posted a record sales growth in the first quarter due to panic buying ahead of lockdown.

Drugmaker AstraZeneca gained 1.4% after saying that it would team up with the University of Oxford to help develop, produce and distribute a potential COVID-19 vaccine.

Copyright Reuters, 2020

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