The FTSE 100’s eight-day rally came to an end on Thursday as soaring optimism regarding the Covid-19 vaccine finally tempered.
The index closed in the red as traders started to realise that any potential Covid-19 vaccine would take a while to be widely distributed, impacting travel and hospitality stocks.
London’s top flight closed 43.16 points lower at 6,338.94 at the end of trading on Thursday.
Connor Campbell, financial analyst at Spreadex, said: “The jubilation of the last week-and-a-half was absent on Thursday, as, like any runner sprinting during a marathon, the markets hit a wall.
“In the Eurozone, the DAX and CAC were the worst hit of the session’s major indices – by comparison the FTSE fell less than 1%, a smidge better than the rest, thanks to the sharp drop-off seen by sterling.
“The pound slumped against the dollar and the euro, on a mixture of GDP disappointment – though the UK economy rebounded by 15.5%, September saw growth of just 1.1% – and no-deal Brexit worries.
“The mid-November deal deadline is almost upon us, with no agreement in site, and Boris Johnson’s Government internally in chaos after the departure of director of communications, and Dominic Cummings ally, Lee Cain.”
The pound fell by 0.59% versus the US dollar at 1.314, but was down 0.91% against the euro at 1.112.
The other major European markets appeared more worried than London, with the French Cac the biggest faller of the session.
The German Dax decreased by 1.24%, while the French Cac moved 1.52% lower.
Across the Atlantic, the major indices were broadly lower as traders started to bank their profits from the big gains which were posted earlier in the week.
In company news, Legal & General slipped in value after the insurer said it planned to keep its final 2020 dividend flat.
The London-based company said it has delivered a “resilient” performance in the year-to-date, with its balance sheet “robust” despite the impact of the pandemic.
Nevertheless, it closed 4.5p lower at 231.6p.
Whitbread shares nudged higher after the hotel and pub owner said it expects to cut significantly fewer jobs than previously announced.
It closed 2p higher at 2,685p after it said the extended Government furlough scheme will help cushion the pandemic’s impact and reduce its proposals for 6,000 job losses.
Vistry Group finished higher after saying it is on track to deliver full-year profit at the top end of its expected range and will resume dividends earlier than expected. It moved 15.5p higher to 775.5p.
Elsewhere, Young’s closed 10p lower at 1,030p after the pub group said the past six months was “one of the toughest periods” in its 189-year history as sales plunged by two thirds.
The price of oil dropped after the latest EIA report showed a big build-up in US oil inventories.
The price of a barrel of Brent crude oil decreased by 0.45% to 44.24 US dollars.
The FTSE 100’s biggest risers of the day were Fresnillo, up 40.5p at 1,125p; 3i Group, up 27p at 1,111p; DCC, up 142p at 5,850p; and Flutter Entertainment, up 275p at 13,705p.
The biggest fallers of the day were Rolls-Royce, down 8.42p at 90p; HSBC, down 15.1p at 372.5p; Sainsbury’s, down 7p at 202.3p; and St James Place, down 35.5p at 1,070p.