May 17, 2019 / 7:43 AM / 3 months ago

FTSE 100 drops as Just Eat rues Amazon backing rival, exporters cushion fall

(Reuters) - London’s main share index dipped on Friday, as Just Eat slumped after Amazon backed rival food delivery firm Deliveroo in a funding round, but losses were limited as exporters were helped by a slide in sterling amid renewed Brexit jitters.

FILE PHOTO: A trader sits at his desk at IG Index in London September 9, 2014. Britain's top shares fell on Tuesday as weaker energy stocks weighed, extending the previous day's retreat on concerns that Scotland could vote to leave the United Kingdom. REUTERS/Luke MacGregor

The FTSE 100 lost 0.1%, but still bagged weekly gains after a turbulent few sessions largely dominated by global trade relations. The FTSE 250 slipped 0.2%.

Online takeaway service Just Eat tumbled 8.2%, its steepest one-day decline in more than a year, after rival Deliveroo said it had gained Amazon’s backing in a $575 million funding round.

The FTSE 100’s decline on Friday came after three sessions of gains, as markets took stock of a plethora of news on Sino-U.S. trade relations, which were strained further after a volley of tariffs and U.S. sanctions on Chinese telecoms firm Huawei.

Worries over the impact of Britain’s departure from the European Union resurfaced. Sterling dived to a four-month low after cross-party Brexit talks collapsed and concern over UK Prime Minister Theresa May’s position grew.

“With the prospect of a new Prime Minister, a general election or the prospect of a Labour government, investors appear to be taking the view that from a political point of view... the UK is running the risk of becoming uninvestable,” CMC Markets analyst Michael Hewson said.

Blue-chip exporter stocks lent some support to the index and limited its losses as the pound was hit by the latest Brexit melee. [GBP/]

Budget airline easyJet, which has seen significant headwinds as a result of Brexit uncertainty, warned of lower revenue in the second half of the year. But its shares rose 5.3% as it stuck to its annual forecast.

Meanwhile, shares of Thomas Cook plunged nearly 40% to a 7-1/2-year low, after Citi downgraded it to ‘sell’ and cut its target price on the stock to zero in the wake of the travel operator’s latest profit warning.

Metro Bank surged 26% on its best day since floating in March 2016, after it raised 375 million pounds of capital. Despite the gains, the stock has lost 60% in value this year after it disclosed an accounting error that led to a regulatory probe and the cash call.

Reporting by Shashwat Awasthi, Muvija M and Yadarisa Shabong in Bengaluru; Editing by Hugh Lawson and Mark Potter

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