UK stocks fall as sluggish retail sales add to recession fears

Pedestrians exit and enter the London Stock Exchange in London, Britain August 15, 2017. REUTERS/Neil Hall/File Photo

Sept 16 (Reuters) – British stocks fell on Friday as a sharp drop in retail sales and a bleak global economic outlook from the World Bank and International Monetary Fund stoked concerns about slowing growth as central banks are preparing for further rate hikes.

The blue-chip FTSE 100 (.FTSE) fell 0.4% at 07:10 GMT, while the mid-cap FTSE 250 (.FTMC) lost 0.8%, both on track to end the week in decrease.

Data showed retail sales fell much more than expected in August, another sign that Britain’s economy is slipping into recession as the cost of living crisis squeezes disposable household spending. Read more

Retailers (.FTNMX404010) slipped 1.6%. British fashion retailers ASOS (ASOS.L) and owner of Primark Associated British Foods (ABF.L) and online supermarket Ocado Retail, a joint venture of the Ocado Group (OCDO.L) and Marks & Spencer Group (MKS .L), all warned of their profits this month.

Mining stocks (.FTNMX551020) fell 2.8%, leading to losses on the commodity-heavy FTSE 100.

Broadly, Asian stocks and the European STOXX 600 (.STOXX) fell as investors braced for a sharp hike in US rates next week. Read more

The Bank of England is also expected to raise borrowing costs by another 50 basis points next week, according to a Reuters poll released earlier this week. Read more

Reporting by Johann M Cherian and Bansari Mayur Kamdar in Bengaluru; Editing by Sriraj Kalluvila; Editing by Sriraj Kalluvila

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