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London stocks retreat as coronavirus, Brexit doubts weigh

10/13/2020 | 04:53am

(For a live blog on European stocks, type LIVE/ in an Eikon
news window)
* Johnson & Johnson suspends COVID-19 vaccine trials
* All eyes on EU summit for progress on Brexit trade deal
* French Connection Group tumbles as sales plunge
* FTSE 100 falls 0.5%, FTSE 250 drops 1.5%

By Devik Jain
Oct 13 (Reuters) - London's mid-cap index fell from
four-month highs on Tuesday on concerns around the timeline of a
COVID-19 vaccine as well as uncertainties over a Brexit trade
deal with the European Union ahead of a self-imposed UK
The domestically focussed FTSE 250 , considered a
barometer for Brexit sentiment, sank 1.5%, while the blue-chip
FTSE 100 slipped 0.5%.
Prime Minister Boris Johnson and the head of the European
Commission are set to discuss Brexit negotiations on Wednesday
afternoon ahead of the EU summit on Oct. 15, while the German
Europe minister said the EU will have to step up preparations
for a no-deal possibility.
Sentiment was also hit by news that Johnson & Johnson
had paused its COVID-19 vaccine candidate clinical
trials due to an unexplained illness in a study participant,
delaying a high-profile effort to contain the global pandemic.

"Because of how important the vaccine would be for various
economies, a delay in that would mean possibly having to live
with the virus for longer and maybe more negative economic
outlook," said Simona Gambarini, markets economist at Capital
Signs of progress on a COVID-19 vaccine and a raft of global
stimulus have helped UK equity benchmarks rise from their
coronavirus-driven lows in March, but they have lagged their
U.S. and European peers as data points to a slowing domestic
economic recovery.
Figures on Tuesday showed Britain's unemployment rate rose
more than expected in the three months to August to its highest
in more than three years and new restrictions announced on
Monday are likely to make that level worse, analysts said.
Separate surveys showed British consumers ramped up their
spending sharply last month, while grocery sales growth
accelerated in September.
Shares of Tesco Plc and WM Morrison Supermarkets
Plc closed up more than 1%.
In company news, clothing retailer French Connection Group
Plc tumbled 19.6% after posting a plunge in first-half
sales due to the health crisis.

(Reporting by Devik Jain in Bengaluru; Editing by Arun Koyyur
and Lisa Shumaker)

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