London midday: FTSE tumbles as banking fears return to haunt markets

The FTSE 100 was down 1.9% at 7,355.45 .

Deutsche Bank paced the decline, sliding more than 13% as the cost of insuring against its default spiked. It dragged the rest of the sector down with it, with the Stoxx 600 banks index 5.4% lower at 136.49.

In UK equity markets, Barclays, NatWest, Standard Chartered and HSBC were the standout losers on the FTSE 100.

Neil Wilson, chief market analyst at Markets.com, said: "As I said many times in the last fortnight - it only stops once people stop asking who’s next. And it doesn’t seem like we’re at that stage yet."

Investors were also mulling comments from Bank of England governor Andrew Bailey, who told the BBC that interest rates will have to rise again if firms increase prices, a day after the Bank hiked rates for the eleventh time in a row.

With banks firmly in focus, encouraging UK data points had no impact.

A survey out earlier showed that private sector output continued to grow in March, boosted by the service economy.

The flash S&P Global CIPS UK Composite Output Index was 52.2 in March, down on February’s eight-month high of 53.1 and marginally missing the consensus for 52.7, but still above the no change level of 50.0.

Within that, the services PMI business activity index was 52.8, down on February’s 53.5.

Elsewhere, figures from the Office for National Statistics showed that retail sales rose more than expected in February.

Retail sales volumes were estimated to have grown by 1.2% month-to-month, following upwardly-revised growth of 0.9% in January.

Finally, a survey from GfK showed that consumer confidence nudged higher in March despite ongoing cost of living pressures.

The latest GfK consumer confidence index was -36, up two points on February and the third consecutive month it has strengthened.

In other corporate news, travel firm Tui slumped after it announced a €1.8bn fund raising to help cut debt and interest costs.

Pub chain JD Wetherspoon gained ground as it said sales for the last seven weeks were 14.9% higher than the same period last year as it swung to a half-year profit despite "ferocious" inflationary pressures. The company posted a pre-tax profit of £4.6m for the 26 weeks to January 29, compared to a £26.1m loss in 2022.

Smiths Group rallied as it reported a jump in first-half profit and lifted its guidance for FY2023.

Market Movers

FTSE 100 (UKX) 7,355.45 -1.92%

FTSE 250 (MCX) 18,419.06 -1.66%
techMARK (TASX) 4,493.57 -1.14%

FTSE 100 - Risers

Reckitt Benckiser Group (RKT) 6,102.00p 1.97%
British American Tobacco (BATS) 2,848.00p 0.87%
Endeavour Mining (EDV) 1,858.00p 0.81%
Diageo (DGE) 3,588.50p 0.72%
Unilever (ULVR) 4,189.50p 0.41%
Coca-Cola HBC AG (CDI) (CCH) 2,179.00p 0.37%
London Stock Exchange Group (LSEG) 7,802.00p 0.28%
Relx plc (REL) 2,587.00p 0.15%
Bunzl (BNZL) 3,050.00p 0.10%
Rentokil Initial (RTO) 564.40p 0.07%

FTSE 100 - Fallers

Barclays (BARC) 130.82p -6.41%
Standard Chartered (STAN) 597.00p -5.60%
NATWEST GROUP (NWG) 253.80p -5.33%
Shell (SHEL) 2,159.50p -4.95%
BP (BP.) 477.05p -4.34%
International Consolidated Airlines Group SA (CDI) (IAG) 133.32p -4.33%
Prudential (PRU) 1,020.00p -4.32%
HSBC Holdings (HSBA) 524.70p -4.29%
Ocado Group (OCDO) 430.00p -3.89%
Ashtead Group (AHT) 4,807.00p -3.86%

FTSE 250 - Risers

Wetherspoon (J.D.) (JDW) 630.00p 8.43%
VinaCapital Vietnam Opportunity Fund Ltd. (VOF) 438.00p 1.62%
Ruffer Investment Company Ltd Red PTG Pref Shares (RICA) 306.50p 0.82%
Caledonia Investments (CLDN) 3,465.00p 0.73%
Target Healthcare Reit Ltd (THRL) 67.90p 0.59%
Genuit Group (GEN) 273.50p 0.55%
Foresight Solar Fund Limited (FSFL) 110.60p 0.55%
Personal Assets Trust (PNL) 477.50p 0.42%
Britvic (BVIC) 870.50p 0.40%
Vietnam Enterprise Investments (DI) (VEIL) 570.00p 0.35%

FTSE 250 - Fallers

Tullow Oil (TLW) 27.38p -7.62%
TUI AG Reg Shs (DI) (TUI) 1,318.00p -6.76%
Harbour Energy (HBR) 244.00p -6.66%
Molten Ventures (GROW) 270.40p -5.85%
Vanquis Banking Group 20 (VANQ) 212.60p -5.68%
IP Group (IPO) 54.00p -5.18%
Intermediate Capital Group (ICP) 1,153.00p -5.14%
Ithaca Energy (ITH) 145.45p -5.06%
Just Group (JUST) 79.50p -4.90%
TP Icap Group (TCAP) 176.60p -4.90%