UK's FTSE 100 ends flat; Unilever, Imperial Brands drop

Reuters

Published Feb 27, 2024 08:34

Updated Feb 27, 2024 17:25

By Shristi Achar A and Johann M Cherian

(Reuters) -Britain's FTSE 100 ended flat on Tuesday, weighed down by consumer staples companies such as Unilever (LON:ULVR) and Imperial Brands (LON:IMB), while investors exercised caution ahead of key inflation figures from Europe and the United States later in the week.

Unilever fell 2.0% as Morgan Stanley (NYSE:MS) downgraded the stock to "underweight," steering a 1.7% loss in the personal care index.

Imperial Brands tumbled 4.8% to the bottom of the large-cap index after a report said British finance minister Jeremy Hunt may announce a new UK tax on vapes as part of his budget next week.

While the globally-exposed FTSE 100 index ended steady, the mid-cap FTSE 250 slipped 0.2%.

Although the domestic economic data calendar is light this week, U.S and European consumer prices data will be closely watched for clues on the monetary policy path globally.

"The FTSE 100 is very much related to the global growth story because it's very heavy on commodity stocks ... so the best case scenario (is) a robust global growth coupled with softening inflation," said Ipek Ozkardeskaya, a senior market analyst at Swissquote Bank.

"It's going to be a slow day until some economic data comes in and that will shape the expectations."

The FTSE large-cap and mid-cap indexes have had a lacklusture start to the week amid uncertainty over the timing of interest rate cuts by the Bank of England, against the backdrop of still high inflation and slowing economic growth.

BoE Deputy Governor Dave Ramsden said that he wanted more evidence that price pressures were easing before considering a reduction in rates.

Among top movers, Croda International lost 3.2% after the chemicals supplier forecast lower 2024 profits, hit by persistently weak volumes in its crop protection and industrial specialities units.