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Highlights
FTSE 100 and FTSE 250 saw declines due to subdued global sentiment and corporate profit warnings.
Whitbread plc (LON:WTB) reported challenging trading conditions with a fall in like-for-like sales.
Hays plc (LON:HAS) issued a profit alert, impacting other recruiters like PageGroup and Robert Walters.
The FTSE 100 index opened the session lower, influenced by cautious sentiment in global equity markets. The decline followed a soft close on Wall Street ahead of the Juneteenth holiday and downward pressure from key Asian indices such as the Hang Seng. The FTSE 250 mid-cap index also saw red as investor caution mounted in response to international monetary and geopolitical developments.
Federal Reserve commentary was a key driver of sentiment, with reduced US growth projections and a higher inflation outlook spooking markets. Despite a base expectation of two rate cuts, a growing cohort of Fed officials anticipate no rate adjustment this year. Fed Chair Jerome Powell emphasized economic uncertainty, particularly with inflation dynamics and employment conditions evolving in response to tariff impacts.
Energy Stocks Provide Limited Cushion
Amid the broader decline, select energy stocks posted modest gains. Brent crude prices climbed due to increased geopolitical tensions in the Middle East, particularly speculation around US involvement in regional hostilities. This supported companies like BP plc (LON:BP.) and Shell plc (LON:SHEL), which recorded marginal increases in share value. Defensive plays like Tesco plc (LON:TSCO) and Centrica plc (LON:CNA) also moved up, offering some stability to the shortened list of risers in the large-cap benchmark.
Recruitment Sector Sees Broad Declines
Recruitment firms led the downward charge in the FTSE 250, with Hays plc (LON:HAS) issuing a trading update that flagged weaker-than-expected profits. The company noted widespread softness in permanent hiring markets, projecting a year-end shortfall relative to prior expectations. The market reacted promptly, pulling the stock to a multi-year low.
This cautious outlook spilled over into peers including PageGroup plc (LON:PAGE) and Robert Walters plc (LON:RWA), both of which experienced significant share declines. The trend signals challenging market dynamics for staffing companies, with lower net fee income anticipated in the final quarter.
Whitbread Hit by Soft Sales and Demand Visibility
Hospitality operator Whitbread plc (LON:WTB), the owner of Premier Inn, reported a decline in like-for-like sales in the UK during the early part of its new financial year. The company cited constrained booking visibility and competitive pressures, particularly outside London, although it continues to outperform the broader market.
Room openings are reportedly progressing, especially in higher-yield urban markets, and business customer growth has been a bright spot. Nevertheless, the cautious trading update weighed on the share price. Broker commentary acknowledged value creation efforts and reaffirmed outlook metrics, despite the soft near-term backdrop.
Mining and Ex-Dividend Stocks Also Fall
The mining sector contributed to the overall index drag, with names like Glencore plc (LON:GLEN) and Rio Tinto plc (LON:RIO) experiencing declines. Meanwhile, ex-dividend activity affected stocks such as Persimmon plc (LON:PSN) and United Utilities Group plc (LON:UU.), both of which recorded marked losses. These movements reflect ongoing price adjustments in FTSE Dividend Yield constituents following recent payouts.
