October 12, 2018 / 9:42 AM / 10 months ago

FTSE fails to rebound in worst week since February

LONDON (Reuters) - UK shares failed to rebound on Friday and posted their worst weekly loss since a market correction in February as a new sell-off hit stock markets across the globe, amid worries about protectionism and fast-rising U.S. interest rates.

FILE PHOTO: A worker shelters from the rain under a Union Flag umbrella as he passes the London Stock Exchange in London, Britain, October 1, 2008. REUTERS/Toby Melville/File Photo

The FTSE 100 .FTSE closed down 0.16 percent, just below 7,000 points, posting a weekly loss of 4.4 percent.

That was just below the 4.7 percent fall back experienced in February when a sudden scare about rising inflation and interest rates first caused a global market correction.

A weakened sterling failed to give an accounting boost to British blue chips as optimism about an agreement on a Brexit deal at a European Union Summit next week faded.

Tobacco stocks Imperial Brands (IMB.L) and British American Tobacco (BATS.L) were the biggest drag on the index, down 3.9 percent and 6 percent respectively after reports of possible further restriction on vaping products in the United States.

“Over the last few years, my weighting towards tobacco has only gone down. I’m trying to quit but I still have an investment,” said Eric Moore, income fund manager at Miton in London.

Sports Direct (SPD.L), the sportswear group controlled by retail tycoon Mike Ashley, rose 1.9 percent after its agreed to buy the freehold of the Frasers department store in Glasgow for 95 million pounds ($125.7 million), it said on Friday.

Ashmore (ASHM.L) increased 0.8 percent after the emerging- markets-focused fund manager said assets under management rose 3 percent in its first quarter, boosted by inflows of client cash, market gains and acquired assets.

Shares in Patisserie Valerie CAKEP.L, which warned on Thursday that it was in danger of collapse if it could not raise capital, were suspended.

Finance director Chris Marsh was arrested by the police on Thursday night and has been released on bail.

Reporting by Julien Ponthus, editing by Larry King and Ed Osmond

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