London stocks retreat on mixed earnings, Sino-U.S. tensions

Credit: REUTERS/Suzanne Plunkett

London-listed shares fell on Friday as a batch of mixed quarterly earnings updates and souring U.S.-China relations dulled optimism about a post-pandemic economic recovery, with education firm Pearson sliding after posting a first-half loss.

By Sagarika Jaisinghani

July 24 (Reuters) - London-listed shares fell on Friday as a batch of mixed quarterly earnings updates and souring U.S.-China relations dulled optimism about a post-pandemic economic recovery, with education firm Pearson sliding after posting a first-half loss.

Pearson PSON.L tumbled 4.2% to the bottom of the FTSE 100 even as it said it had seen a rebound in demand since June.

The blue-chip FTSE 100 .FTSE was down 1.7% and on course for its biggest weekly decline in six. Fewer than 10 stocks on the index were trading higher.

The mid-cap FTSE 250 .FTMC shed 1%, despite a 22% jump for British Gas owner Centrica Plc CNA.L after a deal to sell its North American business to NRG Energy for $3.63 billion.

Asian shares also skidded from six-month peaks as Beijing ordered the United States to close its consulate in Chengdu, in retaliation for being told to shut its consulate in Houston earlier this week. MKTS/GLOB

"The big question remains: for how long can the bulls hold on to the driver's seat," said Charalambos Pissouros, market analyst at JFD Group.

"Further escalation in U.S.-China tensions and a second round of lockdown measures may force more market participants to abandon equities and other risky assets."

The FTSE 100 has struggled in July to build on a three-month rally as hopes for a stimulus-led economic rebound were dented by surging global COVID-19 cases and relatively bleak corporate forecasts.

In the UK, retail sales jumped back almost to pre-coronavirus lockdown levels in June when non-essential stores in England reopened, but analysts warned that a greater shift toward online shopping might prevent a V-shaped recovery.

"Whether this translates into a sustained pick-up in sales will depend on how bad the rise in unemployment is over the coming months," analysts at ING wrote in a note.

Tech-related stocks were among the biggest drags on the FTSE 250, tracking declines on Wall Street. .N

(Reporting by Sagarika Jaisinghani in Bengaluru; editing by Uttaresh.V)

((Sagarika.Jaisinghani@thomsonreuters.com; within U.S. +1 646 223 8780; outside U.S. +91 80 6182 2256;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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