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FTSE weighed down by mining and oil shares

Published 15/11/2017, 10:31
© Reuters. FILE PHOTO: People walk through the lobby of the London Stock Exchange in London
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By Kit Rees

LONDON (Reuters) - Mining and oil stocks put downward pressure on the UK's top share index, which remained stuck at its lowest level in more than a month on Wednesday.

Britain's blue-chip FTSE 100 (FTSE) index was down 0.4 percent at 7,382.94 points by 0909 GMT. Mid caps (FTMC) fell 0.5 percent. That was in line with a broader decline among continental European indexes.

The FTSE had managed to close flat on Tuesday and outperform a negative Europe, but commodity-related shares remained weak.

"With the miners falling ... it's a very heavily-weighted sector on the FTSE," said Henry Croft, a research analyst at Accendo Markets. "We've been really in a consistent downtrend since the beginning of November."

Shares in mining companies Glencore (L:GLEN), Anglo American (L:AAL) and Rio Tinto (L:RIO) fell 2.2 to 2.7 percent as the price of copper slid [MET/L].

The FTSE 350 Mining index (FTNMX1770) lost for a second straight session, touching its lowest level in more than a month.

Oil stocks were also under pressure, as crude prices dropped after the International Energy Agency cut its outlook for 2018 oil demand growth [O/R].

Shares in Royal Dutch Shell (L:RDSa) fell 1.4 percent and BP (L:BP) declined 0.9 percent.

However, precious metals miner Fresnillo (L:FRES) led gains, rising 2.5 percent, and Randgold (L:RRS) advanced 0.5 percent. Precious metals, such as gold, are typically viewed as safe havens in times of market stress.

Fresnillo also benefited from an upgrade by HSBC, which raised its rating on the stock to "buy" from "hold".

Vodafone (L:VOD) was another strong performer, building on the previous session's gains after it lifted its full-year earnings forecast for the first time in recent history, sending its shares more than 5 percent higher.

On Wednesday, Vodafone rose a further 1.2 percent after some price-target upgrades from several brokers.

Outside the blue chips, company updates were very much in focus, with some large declines among British mid caps (FTMC).

Talktalk (L:TALK) fell the most, plummeting around 10 percent after a profit warning.

© Reuters. FILE PHOTO: People walk through the lobby of the London Stock Exchange in London

Crest Nicholson (L:CRST) dropped more than 5 percent after flagging weakness in central London property prices. Average house-price growth across the property company's UK business fell to a quarter of that in 2016, it said.

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