# London stocks fall 1% on weak global growth outlook
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2022-09-01
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: FTSE 100 Falls on Rate Hike Fears and Global Economic Cloud
Meta Description: UK's FTSE 100 index fell 1.0% due to concerns over interest rate hikes and weakening factory data from Asia. Bank of England may slow down rate increases.
URL: https://financedigest.com/london-stocks-fall-1-on-weak-global-growth-outlookhtml

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By Johann M Cherian and Bansari Mayur Kamdar

(Reuters) -UK’s FTSE 100 index fell sharply on Thursday as mining stocks dragged the commodity-heavy index lower over worries interest rate hikes by central banks would dent demand, while slowing factory data from Asia further clouded global economic outlook.

The FTSE 100 slid 1.0% at 0810 GMT, extending losses for its fourth consecutive session.

It’s partly because of the higher interest [rate expectations](https://www.financedigest.com/ecbs-makhlouf-expects-50-bps-rate-hike-in-december.html "ECB’s Makhlouf expects 50 bps rate hike in December") in the U.S. wherein the [Bank of England might now be forced to slow down rate](https://www.financedigest.com/bank-of-england-officials-split-over-future-path-for-rates.html "Bank of England officials split over future path for rates") hikes given Britain faces a cost-of-living standards squeeze,” said Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown.

Traders are [seeing a 74% chance of the Bank of England raising interest rate by 50 basis points at its meeting in September to tamp down inflation](https://www.financedigest.com/britains-next-sees-lower-clothing-inflation-shares-dip-on-cautious-outlook.html "Britain’s Next sees lower clothing inflation, shares dip on cautious outlook"). \[IRPR\]

Miners declined 3.6% as metal prices dropped on demand worries after fresh [data from major global economies](https://www.financedigest.com/stocks-yields-fall-data-suggests-u-s-economy-cooling.html "Stocks, yields fall; data suggests U.S. economy cooling") signalled tepid growth. \[MET/L\]

The domestically oriented FTSE 250 was down 1.3%.

Both the FTSE 100 and the FTSE 250 logged monthly declines in August as aggressive tones by central banks [despite signs of economic](https://www.financedigest.com/uae-plans-long-term-economic-ties-with-israel-despite-political-strains.html "UAE plans long-term economic ties with Israel despite political strains") slowdown hit risk sentiment globally.

Household [expectations for average inflation over the next five to 10 years hit](https://www.financedigest.com/uks-dominos-expects-tech-investments-to-hit-2023-profit.html "UK’s Domino’s expects tech investments to hit 2023 profit") a record high, a monthly survey from YouGov and U.S. bank Citi showed.

Investor [focus was on manufacturing](https://www.financedigest.com/why-manufacturers-mustnt-lose-their-green-focus-in-troubled-times.html "WHY MANUFACTURERS MUSTN’T LOSE THEIR GREEN FOCUS IN TROUBLED TIMES") data for August due at 8:30 GMT for further clues on strength of the British economy.

Reckitt Benckiser fell 4.3% after the company said its [Chief Executive Officer](https://www.financedigest.com/impact-com-appoints-new-chief-people-officer-to-lead-people-growth-and-excellence.html "impact.com Appoints New Chief People Officer to Lead People Growth and Excellence") Laxman Narasimhan will step down at the end of September.

It’s kind of a double whammy of uncertainty about what’s [ahead given that he was three years at the company and at a time when market](https://www.financedigest.com/dollar-soars-to-two-decade-high-as-putin-shakes-fx-market-ahead-of-fed.html "Dollar soars to two-decade high as Putin shakes FX market ahead of Fed") conditions are tougher especially for companies of the likes of Reckitt Benckiser which are highly reliant on consumer spending,” added Streeter.

(Reporting by Johann M Cherian and Bansari Mayur Kamdar in Bengaluru; Editing by Krishna Chandra Eluri)


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