By Shashank Nayar and Bansari Mayur Kamdar
The blue-chip FTSE 100 index declined 0.1% by 08:10 GMT, with AstraZeneca and Diageo PLC being among the top losers.
Softbank-backed online retailer and tech group, The Hut Group, rose 8.4% after saying it would remove its founder’s “golden share” and seek a place on the premium segment of the main stock market.
A survey of chief financial officers at top British companies found that they expect supply chain problems in the UK to persist for at least another year and consumer price inflation to still be above 2.5% in two years’ time.
Supply worries and rising energy costs have slowed the pace of gains on the FTSE 100 recently and led the benchmark index to underperform developed market peers in Europe and the United States.
While U.S. and the wider European stock aggregate have hit multiple record highs this year, the FTSE 100 is around 8% away from all-time highs that were last hit in May 2018.
“If consumers are facing higher energy prices and higher prices of goods in the shops, they may start to become less spend-happy, buying less at some point, which then could have an impact on companies,” said Susannah Streeter, market analyst at Hargreaves Lansdown.
The domestically focussed mid-cap index was unchanged.
Investor sentiment also took a hit after data showed China’s economy grew more slowly than expected in the third quarter, clouding the global recovery outlook.
Gaming software supplier Playtech Plc soared 58% after Australia’s Aristocrat Leisure Ltd said it will buy the company for 2.1 billion pounds ($2.89 billion).
British transport group National Express and its takeover target Stagecoach Group dropped 1.7% and 2.1%, respectively, after the regulator extended the deadline until Nov. 16 for National Express to make a firm offer.
(Reporting by Bansari Mayur Kamdar; editing by Uttaresh.V)