Stronger pound and drop in Reckitt Benckiser shares drags FTSE 100 down 1%
The FTSE 100 fell 1% on Monday, dragged lower by a stronger pound and a drop in Reckitt Benckiser shares after the company revealed a fall in sales following a major cyber attack last month.
London's blue chip index ended the day down 75.18 points at 7,377.73, with Reckitt shares emerging as the worst performer down 258p at 7,623p.
The Durex-to-Dettol firm confirmed like-for-like sales fell 2% in the second quarter after a ransomware attack significantly disrupted its manufacturing and orders systems across a raft of markets, including the UK.
Its chief executive Rakesh Kapoor said the company still has work to do to address the "full implications" of the attack.
Russ Mould, investment director at AJ Bell, said investors should expect the company to endure further pain in the months ahead.
" Most of the group's manufacturing sites were producing close to normal capacity by mid-July but there are a number of activities which will take until the end of August to complete and Reckitt continues to face some operational disruption," he noted.
The FTSE 100 was also knocked by the higher pound, as multinational firms listed on the index tend to benefit when foreign currencies are stronger than the UK currency.
The pound was trading higher by 0.2% against the US dollar at 1.302, and was up 0.5% at 1.119 versus the euro.
That was despite the International Monetary Fund's (IMF) downgrade to the UK's growth forecast from 2% to 1.7% for 2017.
Stocks were mixed across Europe, with the French Cac 40 ending the day up 0.2% and the German Dax closing lower by 0.25%.
Brent crude prices jumped 1.6% to 48.59 US dollars per barrel as investors cheered reports that Opec and non-Opec members had agreed that Nigeria - which was previously exempt from output caps - would also join a deal to curb the oil glut once its own production stabilises.
In UK stocks, Burberry shares were among the best performers on the FTSE 100 after Belgian millionaire Albert Frere raised his stake in the luxury retailer - through his holding company GBL Energy Sarl - from 3% to 4%.
Burberry shares ended the day higher by 9p to 1,652p.
Shares in B&M climbed 16.6p to 357.5p following weekend reports that supermarket giant Asda is mulling over a £4.4 billion takeover of the discount retailer, amid a flurry of consolidation in the supermarket sector.
Cranswick shares jumped 91p to 2,934p as the food giant churned out a 27% rise in first quarter sales, helped by a strong performance in the UK.
The biggest risers on the FTSE 100 were Micro Focus International up 32p to 2,227p, Anglo American up 13p to 1,104.5p, Burberry Group up 9p to 1,652p, and Standard Chartered up 3.9p to 817.6p.
The biggest fallers on the FTSE 100 were Reckitt Benckiser down 258p to 7,623p, Next down 117p to 3,710p, Provident Financial down 69p to 2,297p, and St James's Place down 35p to 1,184p.