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London stocks fell on Friday, with the index set to underperform its European rivals for the week, as weak oil prices weighed on major energy names, and alongside concerns that next week’s summer statement from the U.K. Chancellor will lack big tax cuts.
The FTSE 100 UKX, -1.18% dropped nearly 1% to 6,180.18, while the pound GBPUSD, -0.04% was flat at $1.2454. U.S. markets are closed on Friday for the Independence Day holiday, something that was keeping volumes pinned down in Europe.
Energy names were also lower as oil prices CL.1, -1.45% fell about 1%. Shares of BP BP, +0.86% BP, -1.66% and Royal Dutch Shell RDS.A, +0.39% RDSA, -1.03% stock fell more than 1% each.
Banks also bore the brunt of losses, with Royal Bank of Scotland RBS, +5.35%, RBS, -2.04%, Lloyds Bank LYG, +3.35% LLOY, -2.74% and Barclays BCS, +3.20% BARC, -1.88% all down more than 2% each.
The Financial Times reported that Chancellor Rishi Sunak won’t offer up big tax cuts next week, but he is expected to make an announcement on supporting jobs retention plans. Saturday will mark the reopening of U.K. pubs, restaurants and cinemas, though the city of Leicester will remain locked down over a COVID-19 outbreak. The U.K. is also expected to announce on Friday that visitors from up to 75 countries may be exempt from quarantines, which includes returning U.K. vacationers.
The U.K. services purchasing managers index posted 47.1 in June, up sharply from 29.0 in May and the highest for four months. But it was in line with an earlier ‘flash’ figure of 47.0 in June.
Pub chain Whitbread WTB, +1.66% was one of the gainers, up 0.8%, while Just Eat Takeaway JET, +1.57% rose 2%, after German-based rival Delivery Hero DHER, +2.72% jumped nearly 5% on a positive trading update.
Shares of Rolls-Royce Holdings RR, -9.81% led the decliners with a 5% drop.
Shares of Land Securities Group LAND, +1.14% rose 1.5% after the commercial-property developer and investment company said rental collection and footfall improved in June, and that it plans to restart paying dividends from November.
