The FTSE 100 Finish Line - Friday, March 20

London's FTSE 100 lurched lower again on Friday, heading toward its third consecutive week of losses. Escalating tensions in the Middle East and a surge in oil prices have heightened inflation fears, solidifying expectations that the Bank of England may raise interest rates again. Both the FTSE 100 and FTSE 250 indexes experienced significant volatility throughout the session, reflecting the broader uncertainty gripping global markets.

The Bank of England held interest rates steady at 3.75% during Thursday’s policy meeting but issued a warning that inflation could pose a more significant risk than slowing growth. This prompted traders to estimate a 60% likelihood of a 25-basis-point rate hike by April, with the possibility of up to three additional quarter-point increases by year-end. Adding to fiscal concerns, the UK borrowed more than anticipated in February, driven partly by erratic debt-interest payments amid the Iran conflict, which has elevated borrowing costs and intensified calls for increased public spending.

Oil prices edged higher on Friday, despite major European nations, Japan, and Canada signalling their commitment to ensuring safe passage for ships through the Strait of Hormuz. Meanwhile, the U.S. announced plans to boost supply. In the UK, energy stocks dipped by 0.9%, though they remained near record highs.

On the domestic markets front, pharmaceutical stocks slipped by 0.3%. Unilever saw its shares rise 0.9% after confirming discussions with U.S.-based McCormick & Company over the potential sale of its food business. In contrast, Smiths Group fell 7.9% after missing half-year organic revenue forecasts. JD Wetherspoon suffered a steeper loss, plunging 12.3% as the pub chain warned that full-year profits could fall short of market expectations due to rising energy costs and wage-related taxes, which had already caused a 37% drop in first-half profits.

TECHNICAL & TRADE VIEW - FTSE100