UK midcaps fall on virus woes; Bluechips supported by resource majors

By Shashank Nayar and Ambar Warrick

(Reuters) - British mid-cap stocks ended lower on Tuesday as fears of fresh coronavirus-driven lockdowns overshadowed a fledgling economic recovery, while resource stocks supported the bluechip index.

The blue-chip FTSE 100 <.FTSE> ended largely unchanged, but well above session lows. Energy and mining stocks were the best performers on the index for the day, helped by weakness in the pound <GBP=>.

BP Plc <BP.L> provided the biggest boost to the index after its partially owned Norwegian oil firm Aker BP <AKERBP.OL> on Tuesday beat second-quarter pretax profit expectations.

Still, most other bluechip sectors ended lower as new coronavirus restrictions in California pressured technology stocks.

Tech-oriented investment trust Polar Capital Technology Trust <PCT.L> was the biggest drag on Britain's midcap index <.FTMC>, which lost 1.2% for the day.

Online gadget retailer AO World <AO.L> bottomed out the midcap index <.FTMC> despite reporting a large jump in annual profit, as it warned of a fall in consumer confidence.

Online supermarket and technology group Ocado <OCDO.L> slipped 2.2% despite reporting a 27.2% jump in first-half retail sales.

Speculation over a second wave of British coronavirus infections next winter rattled investors hoping for a quick economic recovery from the pandemic.

Local stocks have rallied from March lows amid slightly improving economic readings, while the government's scaling back of virus-related curbs also looked to help a recovery.

Still, markets remain wary of a surge in COVID-19 cases after the reopening, as seen in the United States and other major economies.

"With the UK being in the early stages of reopening up the economy, there is a fear among investors that if a threshold is exceeded, coronavirus cases might spike," said David Madden, analyst at CMC Markets.

Data on Tuesday showed UK gross domestic product rose 1.8% in May after slumping by a record 20.3% in April. But consumer spending remains far below normal levels and economists are cautious about the longevity of any recovery.

(Reporting by Shashank Nayar in Bengaluru; with additional reporting by Sagarika Jaisinghani; Editing by Shounak Dasgupta, Subhranshu Sahu and Mark Heinrich)