London close: Stocks suffer late sell-off after weak start on Wall Street

(Sharecast News) - UK stock markets suffered from a late sell-off on Thursday after a weak start on Wall Street prompted a bout of profit taking, with the FTSE 100 retreating from a record high.

All three US benchmark indices dropped more than 1% in morning trade in New York after data showed that monthly US existing home sales dropped by their most in nearly four years.

That was enough to send the FTSE 100 - which had been inching higher towards new records earlier on - into the red in the final two hours of trade, finishing 0.7% lower at 10,402.44. The index had jumped 1.1% to a new all-time high of 10,472.11 on Wednesday, as surging commodity prices pushed stocks in the heavyweight mining and oil sectors higher.

The US housing figures came ahead of eagerly anticipated inflation numbers on Friday, which could alter Federal Reserve rate-cut expectations after a stronger-than-expected non-farm payrolls report the previous session.

UK economy expands, slightly

Back on home shores, data out earlier on from the Office for National Statistics showed UK GDP grew by just 0.1% in the final months of 2025, as the services sector stagnated, in line with growth seen in the third quarter. Expectations for the fourth had ranged from 0.1% to 0.2%.

In output terms, growth was driven by a 1.2% increase in production, including a 0.9% improvement in manufacturing. But that was offset by a 2.1% slide in construction - its largest fall in more than four years - and no growth in the dominant services sector. It is the first time there has been no growth in services GDP for two years.

In December, GDP rose 0.1% following downwardly revised growth of 0.2% November. Over 2025 as a whole, GDP is estimated to have increased by 1.3%, up from 1.1% in 2024.

"The UK economy is barely growing yet the stock market hitting new highs might sound an odd pairing. It's important to remember the FTSE 100 is not a direct representation of the UK economy," said Dan Coatsworth, head of markets at AJ Bell.

"Approximately three quarters of its members generate their earnings overseas, and so what's happening with GDP only has limited relevance to the direction of the stock market, although it can affect investor sentiment."

Schroders rockets

In equity markets, Schroders rocketed to the top of the FTSE 100 after the asset manager agreed to be taken over by US investment manager Nuveen in a �9.9bn deal. Nuveen - which is part of the Teachers Insurance and Annuity Association of America - will pay 612p per share. The price comprises a cash consideration of 590p a share and permitted dividends of up to 22p per share. The cash consideration is a 29% premium to the closing share price on Wednesday.

Relx pushed higher as the information group said it expected strong earnings and revenue growth in 2026 after a 9% rise in underlying operating profit last year.

On the downside, Rentokil Initial was the worst performer after US pest control business Rollins tanked on the back of results.

British American Tobacco fell as it said full-year adjusted profit from operations rose 2.3% to �11.3bn, while reported revenue dipped 1%.

British Land and Land Securities were in the red. Neil Wilson, UK investor strategist at Saxo Markets, said real estate groups were down "following a sharp decline in a number of US real estate services groups yesterday on the AI-fear trade".

Mining stocks were also among the worst performers on the Footsie, with names like Fresnillo and Antofagasta pulling back after a commodity price-fuelled rally on Wednesday.

Market Movers

FTSE 100 (UKX) 10,402.44 -0.67%

FTSE 250 (MCX) 23,330.10 -0.37%

techMARK (TASX) 6,008.80 -0.19%

FTSE 100 - Risers

Schroders (SDR) 587.50p 28.56%

Admiral Group (ADM) 2,818.00p 3.22%

BT Group (BT.A) 210.20p 3.04%

United Utilities Group (UU.) 1,345.00p 2.71%

DCC (CDI) (DCC) 5,135.00p 2.70%

Coca-Cola Europacific Partners (DI) (CCEP) 7,320.00p 2.66%

Smurfit Westrock (DI) (SWR) 3,780.00p 2.49%

Experian (EXPN) 2,434.00p 2.48%

Severn Trent (SVT) 3,157.00p 2.40%

Ashtead Group (AHT) 5,270.00p 2.29%

FTSE 100 - Fallers

Rentokil Initial (RTO) 439.80p -6.88%

Prudential (PRU) 1,082.50p -6.80%

CRH (CDI) (CRH) 8,900.00p -4.85%

Standard Chartered (STAN) 1,730.00p -4.66%

Fresnillo (FRES) 3,768.00p -4.07%

Antofagasta (ANTO) 3,729.00p -3.64%

Pershing Square Holdings Ltd NPV (PSH) 4,370.00p -3.36%

BP (BP.) 458.00p -3.12%

HSBC Holdings (HSBA) 1,266.60p -2.97%

Barclays (BARC) 463.60p -2.91%

FTSE 250 - Risers

Morgan Sindall Group (MGNS) 5,290.00p 4.75%

CMC Markets (CMCX) 326.50p 4.65%

Bridgepoint Group (Reg S) (BPT) 266.80p 3.09%

Raspberry PI Holdings (RPI) 273.20p 3.02%

Man Group (EMG) 268.20p 2.92%

BioPharma Credit (BPCR) 0.96p 2.78%

Bellway (BWY) 2,824.00p 2.39%

Ithaca Energy (ITH) 193.25p 2.03%

Mitchells & Butlers (MAB) 286.50p 1.96%

Close Brothers Group (CBG) 496.00p 1.93%

FTSE 250 - Fallers

International Workplace Group (IWG) 224.00p -8.65%

Savills (SVS) 981.00p -7.45%

Trustpilot Group (TRST) 132.70p -6.75%

Clarkson (CKN) 4,005.00p -4.53%

GB Group (GBG) 202.50p -4.48%

Hochschild Mining (HOC) 671.00p -4.14%

Applied Nutrition (APN) 222.70p -4.01%

XPS Pensions Group (XPS) 321.00p -3.89%

W.A.G Payment Solutions (EWG) 115.50p -3.75%

Kainos Group (KNOS) 699.50p -3.65%