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Oil, Banking Stocks Drag FTSE 100 Lower

  • Standard Chartered falls on profit miss
  • Reckitt Benckiser gains on sales beat
  • Travel stocks hit by rising Ukraine tensions
  • FTSE 100 down 0.7%, FTSE 250 off 0.6%

Feb 17 (Reuters) - UK shares fell on Thursday after reports of attack on Russia-backed rebels by Ukrainian forces left investors unnerved, while weaker crude prices hit energy stocks and Standard Chartered's profit miss weighed on banking stocks.

The blue-chip FTSE 100 declined 0.7%, extending losses from Wednesday, after data showed consumer prices rose at the fastest annual pace in nearly 30 years last month.

Russia-backed rebels accused Ukrainian forces of shelling their territory in violation of agreements aimed at ending conflict in the contested Donbass area, the RIA news agency reported, which Ukraine denied later. 

Oil majors BP and Shell fell 1.3% and 1.9%, respectively, tracking weakness in crude prices after France and Iran said parties were closer to an agreement to salvage Iran's 2015 nuclear deal with world powers, offsetting Ukraine tensions.

Stronger energy prices has helped the commodity-heavy FTSE 100 weather geopolitical tensions better than its pan-European counterparts, with BP and Shell gaining more than 20% so far since the start of 2022.

Banking stocks slipped 1.2%, with Standard Chartered falling 4.4% after its full-year profit missed expectations.

"It has a number of legacy issues that it needs to deal with. Over the course of the last 12 months, it's under scrutiny from regulators on both sides of the Atlantic," said Michael Hewson, chief markets analyst at CMC Markets.

The domestically focussed mid-cap index fell 0.6%, with travel stocks dropping 1.4%.

"Travel and leisure is always going to get hit when you have geopolitical concerns in Eastern Europe," said Hewson, noting that Wizz Air and Air France KLM-SA, down 4.5% and 4.7% respectively, were airlines that do a lot of business in that region.

Reckitt Benckiser Group Plc jumped 5.1% on beating analysts' estimates for fourth-quarter sales, as heightened fears about COVID-19 led to increased demand for its cleaning products. 

Reporting by Bansari Mayur Kamdar in Bengaluru; Editing by Subhranshu Sahu and Rashmi Aich

Source: Reuters

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