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UK stocks fell almost 1% in early dealings on Tuesday after Chinese property developer Evergrande missed another bond payment and investors continued to fret about inflation risks.
At 0820, the benchmark FTSE 100 index was down 61.41 points, or 0.9%, at 7,085.44.
Evergrande missed a third bond coupon payment, putting the survival of the property giant under a further cloud and stoking contagion fears should it collapse.
The UK unemployment rate remained at 4.5%, as expected, though average weekly earnings rose by a higher-than-expected 7.2%
In local news, budget airline EasyJet gained 0.6% to 651.6p after it forecast a narrower annual loss than previously feared, as travel markets continue to recover following an easing of lockdowns.
EasyJet, though, was still expecting a significant loss for the year through September of between £1.14 billion and £1.18 billion.
In a positive sign for the new year, it said first-quarter capacity was now expected to be up to 70% of 2019 levels, with first-half bookings expected to double year-on-year.
Fund manager Liontrust Asset Management also rose against the tide, adding 0.3% to £19.96, having reported a 15% rise in first-half assets under management and advice, boosted by fresh inflows into its funds.
Net inflows for the six months through September were £1.1 billion, up from £777 million year-on-year.
Gambling company Entain fell 0.3% to £21.01 even as it reported a 4% year-on-year rise in third-quarter revenue, underpinned by online growth.
Entain stuck to its annual guidance for operating earnings of £850 million to £900 million.
Home builder Vistry shed 0.7% to £11.12 after announcing that chief executive Greg Fitzgerald was willing to stay on beyond 2022.
Vistry had said in January 2020, when it acquired Linden Homes, that Fitzgerald had indicated that he would serve as CEO only until the end of 2022.
Bus company Stagecoach reversed 2.2% to 81.15p despite saying passenger demand in its regional unit had improved as students returned to in-person learning, putting it on course to meet earnings expectations.
Stagecoach, which has agreed to a takeover bid from National Express, said journey numbers in the regional business were in excess of 70% of equivalent 2019 levels by end September.
Property portal OnTheMarket rallied 13% to 104.3p after it posted a fall in first-half profit, owing to higher costs, but upgraded its guidance for the full year.
OnTheMarket said it now expected full-year revenue 'slightly higher' than previous expectations and adjusted operating profit 'substantially ahead' of expectations.
Fire-safety product group Zenova jumped 10% to 17.66p following news that it had launched a wildfire product following a number of successful tests.
In standard laboratory-controlled conditions, the product prevented ignition and flaming of dry grass fuels that were treated with it,' Zenova said.
Also making news, specialist roofing company Marley said it had decided to postpone a planned £75 million initial public offering in London, citing market volatility.
Marley said it made the decision even after receiving 'considerable institutional investor interest.'