UK stocks drop in a broad selloff

The benchmark FTSE 100 dropped 0.4 per cent and the midcap index slipped 0.3 per cent

UK stocks dropped on Friday in a broad selloff, driven by losses in the automotive and personal goods sectors, while a survey showed that British consumers were more optimistic about their outlook for the economy in November.

The benchmark FTSE 100 dropped 0.4 per cent and the midcap index slipped 0.3 per cent. Both the indexes were on track to log weekly declines.

All sectors were in the red, with automobiles and parts and personal goods indexes leading the declines.

Market research firm GfK on Friday said British consumers have turned more hopeful about their outlook for the economy and their personal finances this month, but their mood remained a long way off pre-Covid levels.

By historic standards, consumer confidence is still low, weighed down by wider pressures of a sluggish economic backdrop, prices which are generally still much higher than they were before the pandemic, said Victoria Scholar, head of investment at interactive investor.

Among individual stocks, Barclays jumped 0.3 per cent after Reuters reported the British bank is working on plans to save £1 billion ($1.25 billion), which could involve cutting as many as 2,000 jobs, mainly in the back office.

Both BT Group and Sage Group declined 1.9 per cent each on profit taking and were the worst performers on FTSE. Sage had hit a record high earlier this week after stellar results.

BoE Chief Economist Huw Pill told Financial Times on Friday that the central bank had to hold firm in its battle against inflation and it cannot afford to loosen tight monetary policy.