London’s FTSE 100 Falls Amid Rising Fears; Playtech soars

Pedestrians exit and enter the London Stock Exchange in London, Britain August 15, 2017. REUTERS / Neil Hall / File Photo

  • The Hut group wins by renouncing the “golden share” of the founder
  • Playtech takes off with $ 2.89 billion buyout deal
  • UK chief financial officers expect continued pressure on supply chain
  • FTSE 100 down 0.4%, FTSE 250 down 0.1%

Oct. 18 (Reuters) – London’s FTSE 100 fell on Monday as investors raised bets on a faster Bank of England interest rate hike, while gaming company Playtech soared after a £ 2.1 billion takeover bid by Australian Aristocrat Leisure.

The blue-chip FTSE 100 Index (.FTSE) ended down 0.4%, marking its worst session in nearly two weeks, as healthcare (.FTNMX201030) and travel (.FTNMX405010) stocks were at the head of the declines.

Investors are betting the BoE is planning back-to-back interest rate hikes for its November and December meetings, with more to come next year, after BoE Governor Andrew Bailey reported that the bank central government would act to curb inflation expectations.

“The markets are adopting a stricter policy because the energy crisis could cause a dramatic turnaround in the Bank of England’s interest rate policy,” said Laith Khalaf, head of investment analysis at AJ Bell.

“It certainly looks like there has been a significant shift in rhetoric on the part of the Bank, but there may still be some dominant factors pushing interest rates up next year. “

Softbank-backed online retailer and tech group The Hut Group (THG.L) rose 20.5% after announcing it would remove its founder’s “golden share” and seek a place in the premium segment of the main stock market. Read more

A survey of CFOs of large UK companies found that they expect UK supply chain problems to persist for at least a year and consumer price inflation to be still above 2.5% in two years. Read more

Supply concerns and rising energy costs recently slowed the pace of gains on the FTSE 100 and led the benchmark to underperform its developed market peers in Europe and the United States.

Investor sentiment was also hit after data showed China’s economy grew more slowly than expected in the third quarter, clouding the outlook for a global recovery.

The domestically-focused mid-cap index (.FTMC) fell 0.1%, with airlines Wizz Air Holdings (WIZZ.L) and Easyjet (EZJ.L) falling the most.

Gaming software provider Playtech Plc (PTEC.L) climbed 58.1% to become the biggest winner in the mid-cap index, after Australia’s Aristocrat Leisure Ltd (ALL.AX) announced that ‘he would buy the company for 2.1 billion pounds ($ 2.89 billion).

British transport group National Express (NEX.L) and its takeover target Stagecoach Group (SGC.L) fell by 3.8% and 3.2% respectively, after the regulator extended the deadline to 16 November for National Express to make a firm offer. Read more

Reporting by Bansari Mayur Kamdar and Amal S; edited by Uttaresh.V and Andrew Heavens

Our Standards: The Thomson Reuters Trust Principles.

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