By Avinash P
(Reuters) -London-listed stocks fell on Thursday, as investors paused after a recent rally and scrutinized a number of corporate earnings reports from the likes of advertisement group WPP, banking group Standard Chartered and energy giant Shell.
The blue-chip FTSE 100 was down 0.6% as of 1200 GMT, and was set to snap eight consecutive sessions of gains, while the domestically focused FTSE 250 was also down 0.7%.
The FTSE 100 rose to record highs this week, boosted by upbeat results from majors HSBC and GSK . Supporting the rally were also expectations for an imminent interest rate cut by the U.S Federal Reserve.
The U.S. central bank lowered borrowing costs by an expected 25 basis points on Wednesday, but hinted that the rate cut might be the last for this year.
“I genuinely believe that we do see some profit taking after hitting all time high levels was (due to) the disappointment that the Fed may not lower the interest rates when it meets next month,” said Ipek Ozkardeskaya, senior market analyst at Swissquote Bank.
Earnings in the UK were picking up steam. WPP sank 14% to a near two-decade low after new CEO Cindy Rose warned on profit after a downturn at its flagship media buying agency caused a bigger-than-expected drop in third-quarter net revenue. The stock was the worst performer in the FTSE 100.
Automobile stocks also took a hit, falling 2.2% after Germany’s Volkswagen booked 4.7 billion euro charge due to Porsche’s <P911_p.DE strategy reversal on electric vehicles.
In a bright spot, Standard Chartered gained 2% after the bank said it would hit a key profitability target a year earlier than expected while posting better-than-expected third-quarter earnings.
Among others, Shell reported third-quarter results in which the oil major beat profit expectations. However, shares slipped 0.2% tracking lower oil prices. [O/R]
Shares in British lender Shawbrook jumped 6.2% following London’s biggest initial public offering in two years.
Elsewhere, U.S. President Donald Trump said he reached an agreement with Chinese counterpart Xi Jinping to trim tariffs in exchange for Beijing cracking down on the illicit fentanyl trade.
(Reporting by Avinash P in Bengaluru; Editing by Leroy Leo)
