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Wall St drops after hot inflation data
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Cineworld plunges as it warns on shareholders' equity
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ICAG down on debt worries
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FTSE 100 down 0.4%, FTSE 250 off 0.5%
(Updates to market close)
By Shashwat Chauhan and Shristi Achar A
Feb 24 (Reuters) - UK stocks ended lower on Friday after
hotter-than-expected U.S. inflation data sparked concerns about
the Federal Reserve raising interest rates further, while shares
of Cineworld plummeted as it failed to find a buyer.
The blue-chip FTSE 100 fell 0.4% and the midcap FTSE 250 dropped 0.5%, with the indexes reversing morning gains as U.S> equities tumbled. The FTSE 100 logged weekly declines of 1.6%, its worst such showing since mid-December.
"They (markets) are taking a cue largely from Wall Street," said Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown. "Investor optimism is deflating more rapidly as this latest data indicated that the work in taming inflation is far from over."
Mining stocks such as Anglo American , Rio Tinto and Antofagasta fell in the range of 2.7% and 5.4%, dragging the commodity-heavy FTSE 100 lower.
"A lot of the stocks are internationally focussed and they'll be concerned about downturn in demand in the global economy, which is why you've seen mining stocks fall back," Streeter added.
Meanwhile, Bank of England (BoE) policymaker Silvana Tenreyro said the impact of energy price shock and time lag effects of monetary policies brought a risk of raising borrowing costs too high when attempting to bring down inflation.
Money markets have now fully priced in a 25 basis point rate
hike by the BoE in March. Cineworld plc plunged 43.1% after the cinema chain
operator said its shareholders may see the value of their equity
wiped out as it looks to exit from Chapter 11 bankruptcy
protection following its failure to find a buyer.
British Airways-owner IAG fell 6.5% as the group's
debt remained higher than its market capitalisation despite
forecasting that its earnings could jump almost 90% this year.
(Reporting by Shashwat Chauhan and Shristi Achar A in
Bengaluru; Editing by Rashmi Aich, Nivedita Bhattacharjee,
William Maclean
)
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