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UPDATE 2-FTSE 100 records worst session in 3 weeks on stronger pound

Thu, 09th Sep 2021 09:07

(For a Reuters live blog on U.S., UK and European stock
markets, click LIVE/ or type LIVE/ in a news window)

* easyJet slides on discounted rights issue, rejected bid
offer

* Blue-chip index marks worst session in 3 weeks

* FTSE 100 down 1.0%, FTSE 250 off 0.2%
(Updates to close)

By Devik Jain and Amal S

Sept 9 (Reuters) - Britain's export-heavy FTSE 100 ended
lower on Thursday weighed by a strengthening pound and concerns
over slowing economic growth, while easyJet's share sale plan
sent the British airline to the bottom of the mid-cap index.

The blue-chip index ended down 1.0%, recording its
worst session in three weeks with consumer staple and
pharmaceutical stocks weighing the most.

The domestically focused mid-cap FTSE 250 index fell
0.2%.

The FTSE 100, which jumped around 26% from October lows, is
on course to end the week in the red as the rising spread of the
Delta variant of coronavirus and supply chain issues raised
worries of a slowdown in economic recovery.

"One thing investors hate is tax and taxing a market full of
dividend darlings is a body blow for sentiment," said Keith
Temperton, sales trader at Forte Securities.

"I think that's the overriding reason for stocks being lower
today and that will be a driver for the performance going
forward as well."

Earlier this week, British Prime Minister Boris Johnson set
out plans to raise taxes on shareholder dividends to try to fix
a health and social care funding crisis.

Dollar-earning consumer staples stocks, including Unilever
, British American Tobacco and Imperial Brands
, shed between 1.4% and 1.6% on a stronger
pound.

"And a big negative there is also a pretty strong pound,"
Temperton said.

Meanwhile, the European Central Bank signalled it will only
slightly reduce its emergency bond purchases over the coming
quarter.

easyJet fell 10.2% after the British airline said it
rejected a takeover offer and would raise $1.7 billion from
shareholders to fund its pandemic recovery and expand
operations.

Genus slid 7.6% as Peel Hunt downgraded the
livestock genetics firm's stock to "hold" from "buy" after it
missed annual profit estimates.
(Reporting by Devik Jain in Bengaluru; Editing by Saumyadeb
Chakrabarty, Devika Syamnath and Elaine Hardcastle)

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