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Miners, banks drag FTSE 100 down; JD Sports scales new peak

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By Reuters
Miners, banks drag FTSE 100 lower; JD Sports jumps
Miners, banks drag FTSE 100 lower; JD Sports jumps   -   Copyright  Thomson Reuters 2021
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By Devik Jain and Amal S

-London’s FTSE 100 ended lower on Tuesday, dragged down by heavyweight metals and banking stocks, while JD Sports Fashion jumped to the top of the index after reporting strong earnings.

The blue-chip index fell 0.5%, with miners and banking stocks dropping 2.3% and 1.6%, respectively. [MET/L]

Miners Rio Tinto, Anglo American and BHP Group were under pressure after Barclays cut its price targets on the stocks.

The domestically focused mid-cap FTSE 250 index eased 0.4%, recording its worst session in nearly a week.

JD Sports Fashion gained 9.7% to hit a record high after Britain’s largest sportswear retailer reported record earnings for the first half on robust demand for sneakers and sportswear.

Official figures showed British employers added a record 241,000 staff to their payrolls last month, taking the total number of payrolled employees to pre-pandemic levels.

“Its encouraging, but what’s worrying is the fact that there are over a million job vacancies. For the market, that is an inflationary concern because it’s going to put upward pressure on wages, which feeds through to the bottom line on all the cooperates and then pass on to the consumers,” said Keith Temperton, sales trader at Forte Securities.

“So what might seem like bullish news is potentially quite bearish.”

The focus will now turn to Wednesday’s UK inflation data, which is expected to show prices rose in August and stoke fears of a sooner-than expected change in the Bank of England’s monetary policy.

“The headline number (UK inflation data) might cause a twinge and the robust jobs market might add to speculation that the UK could be within sight of a rate hike,” said Danni Hewson, AJ Bell financial analyst.

Among individual stocks, Portmeirion added 9.7% as the homewares retailer plans to resume dividend payouts this year after reporting record revenue.

Ocado Group fell 1.4% after its joint venture, Ocado Retail, posted a 10.6% fall in revenue in its latest quarter.