Banking and oil stocks send FTSE 100 lower as Ukraine tensions weigh By Reuters

© Reuters. FILE PHOTO: The London Stock Exchange is seen during the morning rush hour in the City of London April 11, 2011. REUTERS/Toby Melville

By Bansari Mayur Kamdar

(Reuters) – British stocks fell on Thursday on reports of trade fires between Ukrainian forces and pro-Moscow rebels, while weakness in financials and energy stocks further rattled sentiment.

The blue chip fell 0.9%, extending Wednesday’s losses, after data showed consumer prices rose at the fastest annual rate in nearly 30 years last month.

Russian-backed rebels and Ukrainian forces on Thursday traded accusations that each had fired across the ceasefire line in eastern Ukraine.

The oil majors BP (LON:) and Shell (LON:) fell 1.4% and 2.7%, respectively, following crude prices as talks to resuscitate a nuclear deal with Iran entered their final stages, but losses were limited by the Ukrainian crisis.

Rising energy prices have helped the commodity-heavy FTSE 100 weather geopolitical tensions better than its pan-European counterparts, with BP and Shell gaining more than 20% since the start of 2022.

Bank shares slid 1.3%, following weak yields on two-year UK government bonds, which fell sharply for a second day in a row.

The domestically-focused mid-cap index fell 1.2% as travel stocks fell 1.8%.

“Travel and leisure are always going to be hit when you have geopolitical concerns in Eastern Europe,” said Michael Hewson, chief market analyst at CMC Markets.

Wizz Air (LON:) and Air France KLM-SA, both down 7.4% each, are airlines doing a lot of business in this region, Hewson added.

Standard charter (LON:) reversed early losses to end up 1.7% after the lender raised key profitability targets and promised shareholders additional payouts, despite full-year profits falling short expectations, as he bets on inflation-fighting rate hikes around the world to boost lending.

Reckitt Benckiser Group jumped 5.9% and was the blue chip index’s biggest gainer after beating fourth-quarter sales estimates as heightened fears over COVID-19 led to higher demand for its cleaning products.

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