The FTSE 100 fell 1.2% on Thursday morning as investor caution persisted across global markets. The FTSE 250 declined 0.5%, while Germany’s DAX dropped 1.5% and France’s CAC 40 slipped 1%.
Brent crude climbed as high as $114, intensifying fears of stagflation as energy costs continue to surge.
Meanwhile, domestic data showed the UK unemployment rate steady at 5.2%, broadly in line with expectations.
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Later today, markets expect the Bank of England to hold interest rates at 3.75% as policymakers weigh the inflationary impact of the ongoing conflict in Iran and the Middle East.
Despite the broader market weakness, BP (LON: BP.) led the FTSE 100 risers, up 1.9% after announcing it had agreed to sell its Gelsenkirchen refinery and related businesses to Klesch Group.
The company now targets $6.5 billion to $7.5 billion of structural cost reductions by 2027, marking a second upward revision to its savings goal. BP said around $1 billion in underlying operating expenditure reductions are expected from the sale.
Prudential edged 1.1% higher, while Diploma gained 0.8%.
The biggest fallers were M&G, down 6.1%, followed by NatWest Group at -5.5% and Fresnillo, which dropped 5.4%.
Separately, Landsec said it had agreed a 192,000 sq ft pre-let to BP at its Timber Square development, with the site now 54% let.
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