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* Johnson under pressure for new lockdown - report
* Sunak to announce one-year spending plan on Nov. 25
* Retailer Next rises on upgrading profit outlook
* FTSE 100 down 2.6%, FTSE 250 drops 1.9%
(Adds comment; updates to close)
By Devik Jain
Oct 28 (Reuters) - London stocks slumped on Wednesday, with
the FTSE 100 tumbling to its lowest level in six months as
investors dumped riskier assets on fears of more lockdowns and
uncertainty over a British trade deal with the EU.
After falling as much as 3.5% in afternoon trade, the
blue-chip FTSE 100 index closed 2.6% lower, dragged down
by losses in mining, personal goods maker
and bank stocks.
The domestically focused mid-cap FTSE 250 index slid
1.9% to a more than three-week low after a media report that
Prime Minister Boris Johnson was being put under pressure for a
new lockdown to tackle a swiftly accelerating second wave of
infections.
"The markets don't like uncertainty, and with case loads up,
there's chatter about potential universal lockdowns, which would
be devastating for the economy and the market," said Greg
Swenson, founding partner of Brigg Macadam, a London-based
investment bank.
Swenson also stressed that fiscal policy that supports GDP
growth, and more importantly wage growth, are needed along with
central bank stimulus to support the real economy.
With markets under pressure this week on concerns that the
new restrictions would derail a nascent economic recovery,
investors will look to British Finance Minister Rishi Sunak's
one-year plan for government spending on Nov. 25, which is to
focus on tackling the pandemic and protect jobs.
Meanwhile, Brexit talks were also in focus, with government
minister Michael Gove in a letter to a Welsh minister saying
that Britain would not back down on its demands to the European
Union over fisheries.
In company news, Next Plc rose 0.7% after the
fashion retailer upgraded its full-year profit outlook on
better-than-expected quarterly full-price sales.
Kaz Minerals jumped 10% after it agreed to be
acquired by a consortium led by its chairman in a 3 billion
pound deal.
(Reporting by Devik Jain in Bengaluru; editing by Uttaresh.V,
Aditya Soni and Hugh Lawson)
Next (NXT)