Sept 11 (Askume) – Britain’s benchmark FTSE 100 index closed lower on Wednesday, dragged down by Rentokil shares after the pest control company warned of weakness in the North American market, while investors assessed the latest U.S. inflation report.
The blue-chip FTSE 100 index (.FTSE) fell 0.2% and the mid-cap FTSE 250 index (.FTMC) dropped 0.6%.
Rentokil Initial (RTO.L) reported a fall in annual profit due to weaker-than-expected sales in North America, its biggest market.The third warning sent shares of the pest control company down 20% .
The company also announced an unspecified number of job cuts for its U.S. workforce in response to rising costs. Sectoral losses were led by the broader Industrial Support Services stock (.FTNMX502050) , which declined 3.4%.
Global stock indexes are under pressure after US consumer prices rose slightly in August , but underlying inflation has stabilized, which could prevent the Federal Reserve from cutting interest rates by half a percentage point next week.
According to CME Group’s FedWatch tool, more than 80% of traders expect the Fed to cut interest rates by 25 basis points.
The UK rate-sensitive housebuilder (.FTNMX402020) fell 0.9%.
In comparison, precious metals miners (.FTNMX551030) were the best performing sector on the day, rising 1.4%. Centamin (CEY.L) rose 1.8% on Tuesday, extending gains for a second consecutive session after the company agreed a $2.5 billion takeover by AngloGold Ashanti.
At the same time, data showed that the quarterly growth rate of Britain’s economic output in July was lower than expected and remained stable after zero growth in June.
Nick Saunders, chief executive of trading platform Webull UK, said: “The data is not enough to change the Bank of England’s direction. A surprise (rate cut) or a sharp rate cut could signal to investors that the economic forecast is much worse.”
WH Smith (SMWH.L) shares rose 10.8% after the company reported annual revenue growth and announced a £50 million buyback programme .
