Home / Business / UK equities slide as the economy dips more sharply in 41 years and Royal Dutch Shell warns of a hit of up to $ 22 billion

UK equities slide as the economy dips more sharply in 41 years and Royal Dutch Shell warns of a hit of up to $ 22 billion



UK equities fell on Tuesday as Royal Dutch Shell’s warning that it could require a $ 22 billion write-down dragged the FTSE 100
UKX,
-0.90%

inferior. The index has still managed to publish its best quarter since 2010, despite falling 0.9% on the last day of June ̵

1; it rose 9% since the beginning of April.

The UK economy has also deteriorated since 1979, as gross domestic product fell 2.2% between January and March, according to data from the Office for National Statistics released on Tuesday.

The negative sentiment was compounded by a coronavirus outbreak located in the city of Leicester, which has now reimplemented some blockade measures.

In an effort to stem the news flow, British Prime Minister Boris Johnson has unveiled a £ 5 billion ($ 6.15 billion) postcoronavirus recovery plan to build homes and infrastructure.

The FTSE 100 fell by 0.9%, while the FTSE 250 most focused on the domestic market fell by 0.5%.

Seashell
RDSB,
-3.68%

RDSA,
-3.94%

equities fell 3.9%, after the major said it would experience a reduction between $ 15 and $ 22 billion in the second quarter and lowered the medium and long-term outlook for oil and prices due to the pandemic . The update dragged the peer BP
BP,
-2.44%

2.5% less. BP announced earlier this month that it would also write $ 17.5 billion, in part because of the coronavirus crisis.

“In a world where the demand for oil is falling and a greater push towards renewable energies, these titans of energy seem more and more creatures of another era, something that should make investors think,” said Chris Beauchamp , chief market analyst of IG.

“Although neither Shell nor BP will go anywhere soon, their importance as dividend payers is likely to decrease compared to other sectors,” he added.

Engineering company Smiths Group
SMIN,
+ 8.78%

it was the biggest hike in the index, climbing 8% as it reported that revenue since the beginning of the year has increased by 6%. The company also announced a restructuring plan to ensure that it “emerges stronger” from the coronavirus crisis.


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