Source: Flickr. Rachel Reeves and her red box.

AstraZeneca’s US listing move was overshadowed as the FTSE 100 slid to monthly lows on renewed fears that Rachel Reeves will hike income taxes in the November budget.

At 10:00am, FTSE 100 futures began to test monthly lows of 9,5776 points, representing a 0.5 per cent from market open, circling the index’s lowest level since late September

In an early morning press conference, Chancellor Rachel Reeves refused to rule out a rise in income tax ahead of the budget, stating “I must deal with the world as I find it, not the world as I might wish it to be”. Her remarks weighed particularly heavily domestic stocks, with drop-offs in the retail and housebuilding sectors dragging the index lower as investors reevaluated their positions in UK assets.

Although AstraZeneca, the top weighted FSTE 100 member, announced that shareholders were found 99.4 per cent in favour of replacing the company’s ADRs on the NASDAQ with ordinary shares listed on the New York Stock Exchange to improve capital availability, the decision had very little effect on the broader exchange. The pharma giant’s shares closed the day at 12,528p, an intraday rise of 1.7 per cent. A small rally that failed to offset prevailing market weakness traversing UK sectors.

According to Chris Beauchamp, IG’s Chief Market Analyst, the proximity of the budget may offer comfort to investors over time, but concerns remain over the UK’s market performance relative to its international peers. Citing these concerns, Beauchamp said the “broader concerns about the budget are beginning to make themselves felt” in UK equity markets, as investors remain bearish ahead of Reeves’ speech.

Despite periods of strength in the pharmaceutical sector, the FTSE 100 closed the day down 9.48 points, illustrating the gloomy UK investor attitude as fiscal speculations overpower corporate growth. The index’s close demonstrated the degree to which bearish risk-aversity has dictated market sentiment, supressing what growth potential remains for the growingly illiquid index. Investors will now turn their attention to sector-focused indicators, such as the FSE 350 Pharmaceuticals and Biotechnology Index as well as UK retail benchmarks, for signals of resilience or continued decline as expectations around fiscal tightening continue to develop.