London stocks fall as U.K. GDP revised slightly lower and worries over delta variant simmer

Fresh data showed U.K. growth decreased by 1.6% in January to March, compared with an initial estimate of a 1.5% fall. A “key influence on the evolution of GDP was the renewed national lockdown through most of Q1 and the associated government measures,” said Sandra Horsfield, economist at Investec, in a note to clients.

Horsfield highlighted parts of the data that drove home the limited spending potential of households, such as consumption that was revised down to -4.6% quarter-on-quarter, from -3.9%, and the household saving ratio, which “jumped from 16.1% in Q4 to 19.9% in Q1 – the second highest quarterly reading since the series began in 1963,” she noted.

Banks and miners were dragging on the downside, with shares of HSBC HUKX, -0.52% HSBC, -0.59% down 1% and Barclays BARC, -1.54% BCS, -0.88% off 1.7%. Mining stocks such as Rio Tinto RIO, -0.93% RIO, -1.15% were slightly softer as China’s official purchasing managers index slipped slightly in June, along with nonmanufacturing growth.

Among smaller companies, shares of Dixons Carphones DC, +6.02% climbed 6% after swinging to a pretax profit for fiscal 2021 thanks to a big bump in online sales. The retailer of electrical and telecommunications products cited a strong performance and confidence about its outlook.

“Dixons could easily be a takeover target given it has a net cash position, it is generating lots of free cash flow, it boasts a strong brand in Curry’s, and strategically it has already done a lot of hard work to fix the problems of the past,” said Russ Mould, investment director at AJ Bell, in a note to clients.

Shares of Cineworld CINE, -5.76% were among the stocks in the red, with shares of the movie theater operator dropping 5%.