London stocks edged lower on Wednesday amid worries about inflation and a global slowdown
London stocks edged lower in early trade on Wednesday amid worries about inflation and a global slowdown, as investors eyed the Jackson Hole symposium.
At 7:30 am GMT, the FTSE 100 was down 0.3% at 7,467.66.
Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said: Caution is the name of the game on equity markets with expectations that aggressive policies to tame roaring inflation will continue despite fresh signs that the US economy is slowing.
The dramatic fall in the S&P Global composite PMI in August highlighted how demand was falling for the US services sector in particular as supply chain snarl ups, inflationary pressures and interest rate hikes took their toll. The ultimate impact of this drop in demand should be deflationary but it’s not clear how far and how fast these trends will feed through to lower headline prices, she said.
The data sparked a squally session on Wall Street as investors assessed the darker clouds gathering over the US economy, and signals from central bank policymakers that more rate hikes were ahead to try and ensure the inflation storm subsides, she said.
There are expectations that the chair of the Federal Reserve Jerome Powell will underline that message at annual central bank gathering at Jackson Hole, Wyoming on Friday. The FTSE 100 has retreated at the open amid a fresh round of risk off sentiment and worries about the prospects for global trade, she said.
Corporate news was thin on the ground.
Flexible workspace provider IWG was in the red as it announced the appointment of Charlie Steel as its new chief financial officer, succeeding Glyn Hughes. Steel joins IWG from Babylon Holdings, a digital health delivery and AI diagnosis business.