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UK Shares Fall as Recovery Worries Hit Mining, Energy Stocks

March 23 (Reuters) - British shares fell on Tuesday, dragged down by energy and mining stocks, as fresh lockdowns and slow vaccine rollouts across Europe stoked fears over the pace of economic recovery.

The commodity-heavy FTSE 100 index was down 0.2%, with oil heavyweights BP and Royal Dutch Shell being the biggest drags, shedding 1.9% and 1.3% respectively.

Mining stocks including Rio Tinto, Anglo American , and BHP were also among the biggest laggards.

“There is a rising concern about the third wave of pandemic in continental Europe that could easily migrate over to UK,” said Connor Campbell, an analyst at Spreadex.

“We have also got increasingly tense situation between the West and China. So, I think there’s perhaps a deja vu this morning, certainly a whip of 2020 about the morning headlines.”

The FTSE 100 has risen 3.6% so far this year on the back of global stimulus measures and optimism about an economic rebound from vaccination rollouts. But the possibility of prolonged lockdowns due to rising virus cases has made investors cautious.

Britain’s jobless rate unexpectedly fell in the three months to January, a change that partly reflected people giving up their job hunt as lockdown measures tightened at the start of the year, official figures showed.

The domestically focused mid-cap FTSE 250 index fell 0.4%, hit by losses in industrials stocks.

AstraZeneca Plc fell 0.8%, after a U.S. health agency said the drugmaker might have provided an incomplete view of efficacy data on its COVID-19 vaccine from a large scale trial in the United States.

Cineworld fell 1.3%, even after saying it would re-open U.S. theatres in April and its UK halls a month after, in time to screen big-budget movies including “Godzilla vs. Kong”, after prolonged shutdowns due to the health crisis.

(Reporting by Shivani Kumaresan in Bengaluru; Editing by Rashmi Aich and Subhranshu Sahu)

Source: Reuters


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