Business

Global trade weighs heavy on oil and mining stocks

Gloomy prospects over global trade weighed on oil and mining stocks
Gloomy prospects over global trade weighed on oil and mining stocks Gloomy prospects over global trade weighed on oil and mining stocks

THE London market was down yesterday as gloomy prospects over global trade weighed on oil and mining stocks.

The FTSE 100 Index was 27.1 points down at 6417, as investors' cheer over economic news from China and the European Union at the end of last week faded.

Germany's DAX was flat, while France's Cac 40 was down 0.5 per cent. In New York the Dow Jones Industrial Average was slightly down in early trading.

On Friday, stocks rose after China cut its key interest rate for the sixth time this year, falling by 0.25 per cent to 4.35 per cent, in the hope this will spur growth as the country tries to reduce its reliance on construction and heavy industry.

They were also buoyed following comments from European Central Bank (ECB) president Mario Draghi at the end of the week. He said the bank will consider increasing its monetary stimulus at its next meeting in December from its present €1.1 trillion (£805 billion) level. Cheap cash tends to favour investors.

But Spreadex financial analyst Connor Campbell said investors were seemingly "less sure about the Chinese rate cut than they were last Friday".

The pound was flat against the euro at 1.39, after a report said that UK factory orders fell in the three months to October to show their biggest quarterly decline since 2012 due to weak demand. Sterling was slightly up against the US dollar at just under 1.54.

Heavyweight commodity stocks were lower on lacklustre prospects for world trade with Anglo American the biggest faller in the top flight, down 19p to 590.9p, Rio Tinto 19p lower to 2487.5p and BP 3.7p down to 384.4p.

AstraZeneca was up 22p to 4091.5p, after the US Food and Drug Administration cleared its lesinurad drug, in combination with a xanthine oxidase inhibitor, to be approved for the treatment of hyperuricemia associated with gout.

Aberdeen Asset Management was the strongest riser in the top flight lifting 3 per cent, or 10.3p at 361.7p, after a report in the Financial Times said it was looking for a buyer.

Aberdeen has seen its profits hit due to the recent turmoil in emerging markets, where the group built its reputation and much of its investments are based. The firm later issued a statement to Reuters denying it was eyeing a sale.

Outside the top flight telecoms firm TalkTalk saw its shares fall by more than 12 per cent, or 31.5p to 225.3p, after it revealed last week that millions of its customers could have been accessed by hackers after a "significant and sustained cyber attack" on its website.

Chief executive Dido Harding warned of a "cyber security arms race" threatening all UK companies as she revealed she called in defence experts over the hack of its website. Shares were at their lowest in more than two years.

The biggest risers in the FTSE 100 Index were Aberdeen Asset Management up 10.3p at 361.7p, TUI up 20p at 1228p, International Airlines Group up 9.5p at 608p and Diageo up 20p at 1878.5p.

The biggest fallers in the FTSE 100 Index were Anglo American down 19p at 590.9p, Glencore down 3.2p at 116p, WPP down 32p at 1448p and Wolseley down 81p at 3776p.