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* Smiths Group jumps on positive results and dividends
* Moonpig falls despite strong full-year forecast
* FTSE 100 down 0.5%, FTSE 250 off 1.7%
(Updates to close)
By Shashank Nayar, Bansari Mayur Kamdar and Amal S
Sept 28 (Reuters) - London's blue-chip FTSE 100 index ended
lower on Tuesday, dragged down by heavyweight homebuilders and
financial stocks, while the technology company Smiths Group
topped the index after delivering strong annual earnings.
The FTSE 100 index eased 0.5%, with the housebuilder index
and financials leading declines.
The domestic-focused mid-cap index dropped 1.7%,
recording its worst session in over two months, with travel and
leisure stocks among the top losers.
The FTSE 100 has gained 9.8% from its lowest point this
year, buoyed by strong second-quarter earnings and dovish
central bank policies. Its pace of growth has, however, slowed
recently due to inflation concerns.
Kunal Sawhney, chief executive officer at Kalkine, said
rising inflation pressures as energy prices continue to rise
amid supply bottlenecks had unnerved UK investors fearing that
higher interest rates could be brought forward.
Higher costs and supply chain disruptions have recently
pushed central banks to adopt a more hawkish tone, with Bank of
England Governor Andrew Bailey hinting that the case for higher
interest rates is building.
The wider homebuilder index fell 3.0%, hitting its lowest
level in more than two months. Taylor Wimpey, Bellway
and Countryside Properties were down between
2.7% and 4.0%.
"When you've got hawkish language, interest rate-sensitive
sectors such as house builders and other utilities are the ones
hit," said Keith Temperton, sales trader at Forte Securities.
Further losses were limited by gains in energy stocks
, which tracked stronger oil prices.
British software automation company Blue Prism Group
dropped 4.0% after agreeing to a 1.1 billion pound
($1.5 billion) takeover offer from American private equity firm
Vista Equity Partners.
British online greetings card retailer Moonpig
fell 5.1%, despite raising its annual revenue
forecast.
However, Smiths Group jumped 4.1% after signing a
binding agreement to sell its medical devices unit, Smiths
Medical, and declaring a dividend of 26 pence after robust
annual earnings.
(Reporting by Bansari Mayur Kamdar, Shashank Nayar and Amal S;
Editing by Sherry Jacob-Phillips, Rashmi Aich and Kevin Liffey)