UK FTSE 100 at three-month low as rate hike worries grip; Currys slumps

UK’s FTSE 100 touched a more than three-month low on Thursday, as minutes from the U.S. Federal Reserve’s last meeting rekindled concerns of a tighter monetary policy, while shares of Currys tanked after the retailer reported a fall in profit.

The blue-chip FTSE 100 fell 1.2%, hitting its lowest level since March 24. The domestically-focussed FTSE 250 midcap index, too, lost 1.2%.

Currys tumbled 13.3% to its lowest level in more than 20 years after the electricals retailer reported a 38% slump in full-year profit.

Minutes from the U.S. Federal Reserve’s June meeting showed “almost all” officials agreed to hold interest rates steady at the June meeting to buy time and assess whether further rate hikes would be needed.

Chris Beauchamp, chief market analyst at IG Group said that the markets are perceiving the Fed’s decisions as more of a “hawkish pause.”

“People were saying they’re pausing but its not a longer-term move,” Beauchamp added.

China-exposed bank HSBC (LON:HSBA) and Standard Chartered (LON:STAN) fell 1.3% and 1.9%, respectively, while insurer Prudential (LON:PRU) lost 1.2% on elevated Sino-U.S. tensions.

Industrial metal miners fell 1.8% as prices of most base metals came under pressure. [MET/L]

The commodity-heavy UK benchmark has been underperforming its peers this year amid volatility in resource prices over an uncertain global outlook.

Meanwhile, the pan-European STOXX 600 is up nearly 7% and the U.S. S&P 500 is up about 16% on the back of a frenzy over AI-related stocks.

Data showed British house building fell in June at the sharpest pace in more than 14 years, barring two months early in the COVID-19 pandemic.

Among individual stocks, United Utilities climbed 1.8% after Morgan Stanley (NYSE:MS) raised the water utility firm’s rating to “overweight” from “equal-weight.”

Money transfer group CAB Payments said it had sold up to 335 million pounds ($426 million) of shares in its initial public offering (IPO) on Thursday. Shares were trading down 3.8%.