Economic news

FTSE 100 Stalled by Vodafone Outlook Cut, Weak Data

  • Vodafone slides after annual forecast cut
  • Jobless rate 3.6% vs Reuters poll 3.5%
  • Aston Martin slumps to bottom of FTSE 250
  • FTSE 100 up 0.1%, FTSE 250 off 0.3%

Nov 15 (Reuters) - The UK's FTSE 100 inched higher on Tuesday, mirroring gains in global markets, while disappointing outlook from Vodafone and weaker-than-expected employment data checked further gains.

The blue-chip FTSE 100 rose 0.1%, hovering just below a two-week high hit last week, following a strong session in Asian markets on optimism over China's easing COVID-19 restrictions.

However, weighing on the index, Vodafone tumbled 6.9% to a two-year low after the mobile phone group cut its full-year free cash flow forecast, reflecting a worsening global macroeconomic climate and higher energy costs.

"It's certainly not plain sailing at Vodafone right now," said Matt Britzman, equity analyst at Hargreaves Lansdown. "Warnings that weaker economic conditions and rising costs are set to bring full-year results down from previous guidance put a dampener on half-year results.

Data earlier showed Britain's unemployment rate unexpectedly rose in the three months through September and vacancies fell for the fifth report in a row as employers worried about the outlook for the economy ahead of a tough government budget plan later this week.

Finance Minister Jeremy Hunt is set to raise taxes and cut spending on Thursday to fix public finances, potentially deepening an expected recession.

"I think they're going to announce austerity measures, but they're going to do it in a way that the lower income households are going to be protected," said Daniela Hathorn, senior market analyst at

"The key takeaway is if the government is able to announce measures that will help control inflation without perceiving that they are hurting the economy too much, I think we're going to see a positive reaction in UK market."

The pound rallied against a weakening dollar amid growing expectations that the U.S. Federal Reserve will slow its pace of interest rate hikes.

The FTSE 250 midcap index slipped 0.3%, with Aston Martin slumping 11.9% after Jefferies slashed the luxury carmarker's rating to "underperform".

Reporting by Shashwat Chauhan amd Sruthi Shankar in Bengaluru; Editing by Shounak Dasgupta

Source: Reuters


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