By Johann M Cherian and Shashwat Chauhan
(Reuters) -British equities slipped on Friday after chemicals firm Croda hauled the sector to its worst day in over three years, while housing-related stocks continued their downward spiral as stresses in the sector continued to build.
The FTSE 100 benchmark index lost 0.5%, while the FTSE 250 midcap index slipped 0.1%. Both indexes logged weekly declines of 0.6% and 0.3% respectively.
The FTSE 100 fell for the third straight week as jitters around global interest rates remaining higher for longer dented risk appetite following surprise hikes by two major central banks earlier this week.
The chemicals sector lost 7.7%, dragged down by a 12.5% fall in component Croda International after the speciality chemicals group’s profit warning.
“When a company has a track record of delivering the goods, then a premium rating is awarded by the market,” said Russ Mould, investment director at AJ Bell.
“Which means when something goes wrong, the share price reaction can be particularly negative.”
The real estate and the home construction sectors declined 0.4% and 1%, respectively, as mortgage rates in Britain rose again with economists warning that rising borrowing costs would put the housing market under renewed strain.
Credit ratings agency Moody’s said British house prices are likely to fall 10% over the next two years and a more severe downturn in the housing market could trigger a lengthy recession.
A strengthening pound added to losses on the exporter-heavy FTSE 100. [GBP/]
Among individual movers, Network International advanced 5.6% after Brookfield Asset Management said it had reached an agreement with the payments provider for a cash offer of 2.2 billion pounds ($2.76 billion).
Amigo Holdings soared 123.1% on granting shareholder Michael Fleming an agreement to look for financing options for the troubled company.
(Reporting by Johann M Cherian and Shashwat Chauhan in Bengaluru; Editing by Rashmi Aich, Anil D’Silva and Nick Zieminski)
