Old Mutual shares fall after earnings
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U.K. stocks headed sharply lower again on Friday, as the escalating tensions between the U.S. and North Korea rattled investors and helped drive a global selloff.
The FTSE 100 index slumped 0.8% to 7,332.52. At this level, the benchmark is on track for its lowest close since late June, according to FactSet data. On Thursday, it logged its biggest one-day percentage loss since April 18, when a "snap" U.K. general election was called.
For the week, the London index is looking at a 2.4% drop, which would be its biggest weekly loss since April.
On Thursday, U.S. President Donald Trump said his earlier threat to unleash "fire and fury" on North Korea "maybe wasn't tough enough." (http://www.marketwatch.com/story/trump-today-president-tweets-get-back-to-work-at-senate-majority-leader-mcconnell-2017-08-10) Additionally, China weighed in on the standoff, saying in an editorial in state-run Global Times (http://www.globaltimes.cn/content/1060791.shtml) that Beijing will intervene if the U.S. strikes first against North Korea.
"Trump has upped the ante so the market is having to price in possible military intervention," said Jasper Lawler, head of research, at London Capital Group, in a note.
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Read:What to do with stocks if the U.S. and North Korea go to war (http://www.marketwatch.com/story/what-to-do-with-stocks-if-the-us-and-north-korea-go-to-war-2017-08-10)
Howard Gold:A new missile crisis is here, and Trump is no JFK (http://www.marketwatch.com/story/a-new-missile-crisis-is-here-and-trump-is-no-jfk-2017-08-10)
"Love or loathe him, Trump isn't one to back down from a confrontation, so its perhaps not a surprise that things have escalated. North Korea responding with a threat to U.S. territory after Trump warned them not to threaten the U.S. was never going to go down well," Lawler said.
"We assume markets will move on if it remains purely a war of words but the selloff looks durable," he added.
Stock movers: Shares of Old Mutual PLC (OML.LN) fell 1.2% even after the company raised its dividend 32% (http://www.marketwatch.com/story/old-mutual-lifts-dividend-32-after-earnings-rise-2017-08-11) . The financial services company reported an 87% jump in net profit in the first half of the year.
Mining shares were among biggest the decliners as investors shunned assets seen as more risky. A slowdown in Chinese fiscal spending (http://www.marketwatch.com/story/chinas-fiscal-spending-growth-slows-2017-08-11) also hit commodities stocks, as the sector is highly exposed to growth and spending on infrastructure projects in China.
Rio Tinto PLC (RIO) (RIO)(RIO) dropped 3.6%, Glencore PLC (GLEN.LN) lost 3.5%, Anglo American PLC (AAL.LN) fell 3.2%, and BHP Billiton PLC (BLT.LN) (BHP.AU) (BHP.AU) gave up 2.7%.
On an upbeat note, shares of Coca-Cola HBC AG rose 0.9%, adding to a 9.2% jump from Thursday when the beverage bottler said strong volume growth, price increases and improved packaging mix resulted in a rise in first-half earnings (http://www.marketwatch.com/story/coca-cola-hbc-earnings-rise-on-volume-growth-2017-08-10).
(END) Dow Jones Newswires
August 11, 2017 04:14 ET (08:14 GMT)