March 19 (Reuters) – London’s main indexes fell sharply on Thursday as an intensifying conflict in the Middle East sapped risk appetite, with investors also keeping a close eye on the Bank of England’s monetary policy verdict.
The blue-chip FTSE 100 fell 1.9% by 1020 GMT.
Meanwhile the mid-cap FTSE 250 was down 2%, hitting its lowest level since November last year.
The energy sector rose 0.9% to a record high, as oil prices jumped after Iran attacked energy facilities across the Middle East following Israel’s strike on its South Pars gas field, a major escalation in the war. [O/R]
Most of the other major sectors were trading in the red, with metal miners and banks down 7.2% and 3.7% respectively, making them the day’s worst performers.
HSBC dropped 2.7% after Bloomberg reported that the bank is considering job cuts of up to 20,000 roles.
Adding to the cautious mood, investors are awaiting the Bank of England’s policy decision at 1200 GMT.
The central bank now looks set to hold off on an interest rate cut that had seemed all but certain before the Middle East conflict erupted, and is expected to strike a vague tone on its next steps as it monitors the potential inflationary fallout from the war.
Meanwhile, British wages rose at their slowest pace since late 2020 in the three months to January, according to official data which also suggested a weakening in employment might have bottomed out before the start of the war in the Middle East.
Among other movers, IG Group rose 5.5% to a record high after saying it is exploring deals, partnerships and a possible move from London to tap faster‑growing markets.
(Reporting by Tharuniyaa Lakshmi in Bengaluru; Editing by Nivedita Bhattacharjee)
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