London stocks decline as rate hike fears linger; Coca Cola HBC shines

UK’s FTSE 100 touched an over three-month low on Friday, as fears of high global interest rates persisted ahead of a crucial U.S. jobs data report, though shares of Coca Cola HBC jumped after the bottler raised its profit outlook.

The internationally-focussed FTSE 100 lost 0.4%, extending declines after a more than 2% fall on Thursday, while the more domestically-focussed FTSE 250 midcap index also fell 0.2%.

Both indexes are on track to post weekly declines, with FTSE 100 hovering near its lowest weekly level in 15 weeks.

Bottler Coca Cola HBC AG (LON:CCH) was an outlier, jumping to the top of the FTSE 100 after it gained 3.1% on raising its 2023 profit expectation.

A key reading of U.S. jobs data due later in the day will be eyed to gauge the U.S. Federal Reserve’s monetary tightening plans after the central bank kept rates steady in its previous decision.

“We’re anticipating this jobs report today, but the private jobs data that came out yesterday was looking very hot,” said Jonathan Sparks, CIO for UK and Channel Islands, HSBC (LON:HSBA) Global Private Banking & Wealth.

“…the Fed is going to have to work against this.”

Data showed on Thursday that U.S. private payrolls surged in June, hinting at a resilient labour market.

All FTSE 350 sector indexes are on track to end the week lower, as rekindled fears of tighter monetary policy in the United States and weak demand outlook from top commodities consumer China weighed on sentiment.

Mortgage lender Halifax said British house prices fell last month in annual terms at the fastest rate in 12 years and soaring interest rates are likely to herald more weakness in the housing market.

Housing related stocks like real estate, real estate investment trusts (REITS) and homebuilders fell between 0.8% and 0.6%.

Bank of England interest rate-setter Catherine Mann will be speaking in a panel discussion in New York later in the day.