Inflation and China fears return to the LSE

London shares dropped yesterday after another weak economic data from China fuelled concerns about the country’s economy. Fears for demand weighed on commodity stocks.

JPMorgan lowered its price target on supermarket chain Tesco, which pushed the whole sector lower. The FTSE 100 fell 0.2%.

Investors are still digesting Chinese data and the mood hasn’t improved so far, with the FTSE 100 down 0.9% at 9am.

Although the odds are still in favor of a pause in Fed rate hikes, bond yields continue to rise, which on the contrary foreshadow a difficult monetary future. The cause is a potential reawakening of inflation, fuelled by a surge in energy prices.

Shares of Barratt fell 4.4% after the housebuilder posted lower annual earnings issued a cautious outlook.

Things to read today:

Russian and Saudi Oil-Production Cuts Flash Warning on Chinese Economy (WSJ)

Global Financial Watchdog warns of “further challenges and shocks” ahead (Financial Times)

UK workers will be worse off in 2024 than in 2019, thinktank warns (The Guardian)