London’s FTSE 100 falls for second day as Shell weighs in

  • FTSE 100 down 0.8%, FTSE 250 up 0.4%
  • Imperial Brands mounts its share buyback plan
  • Weaker refining and gas trading will hit Shell’s third-quarter results
  • Construction activity unexpectedly improves

Oct 6 (Reuters) – Britain’s FTSE 100 index fell on Thursday, with Shell weighing on the heavy commodities index after the oil major said its third-quarter profits would come under pressure as concerns grew over a global economic downturn.

The benchmark FTSE 100 (.FTSE) closed down 0.8%, while the more domestically oriented FTSE 250 added 0.4%.

Shell (SHEL.L) fell 2.8% after the oil major said its third-quarter profits would be under pressure due to an almost halving of oil refining margins, the erosion chemical margins and weak natural gas trading. Read more

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Peer BP Plc was stable.

“Shell’s message is seen as a proxy for the oil and gas industry in general, ie the excess profits they used to make are now ending as the price of oil goes down,” he said. said Stuart Cole, chief macroeconomist at Equiti Capital.

“But beyond that, the underlying message is that demand for oil and gas, refined products, plastics is falling, which is seen as a sign of declining global demand.”

Mining shares (.FTNMX551020) slipped 1.4% with Anglo American (AAL.L) leading the losses as Berenberg cut the miner’s rating from ‘hold’ to ‘buy’.

The FTSE 100 was still poised to end the week higher as investors gauged the UK government’s reversal of tax cuts in its new fiscal policy and falling global bond yields boosted appetite for riskier stocks earlier in the week.

Capping some losses, Imperial Brands (IMB.L) added 2.5% as it announced a £1 billion ($1.13 billion) share buyback program and said trading for the financial year 22 were as expected.

Fitch, meanwhile, downgraded its credit rating outlook for UK government debt from ‘negative’ to ‘stable’, days after a similar move by rival Standard & Poor’s following the government’s budget statement. of September 23. Read more

Activity at British construction companies unexpectedly improved last month, although the outlook has darkened as growth in new orders has dried up, a survey showed. Read more

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Reporting by Johann M Cherian and Bansari Mayur Kamdar in Bengaluru; edited by Uttaresh.V and Bernadette Baum

Our standards: The Thomson Reuters Trust Principles.

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