Energy and mining stocks drag FTSE 100 lower due to weak commodity prices
By Shashank Nayar
(Reuters) – London’s FTSE 100 fell on Monday, dragged down by heavy energy and mining stocks as concerns over demand for commodities returned amid a global rise in coronavirus infections.
The blue-chip FTSE 100 slipped 0.2% with BP, Anglo American, Glencore and Royal Dutch Shell being some of the better brakes.
“The decline appears to be a short-term burst rather than a market-wide concern, as commodity support still appears unwavering,” said David Madden, analyst at Equiti Capital.
The mid-cap index fell 0.2% as the global page recruiting group led the declines despite announcing it would spend £ 100million on shareholder returns amid trading conditions. trading improved in the first half of the year.
The FTSE 100 has gained nearly 10% so far this year, but has lagged far behind its US and European peers, penalized by a resurgence in COVID-19 infections and inflationary fears outweighing the optimism about robust corporate earnings.
As the economy reopens, the market knows that higher inflation won’t be a problem as long as it is in tandem with economic growth, Madden said.
Among other shares, Vecture gained 2.1% after tobacco company Philip Morris raised its bid on the drugmaker to 165 pence ($ 2.29) a share.
Deliveroo jumped 9.9% after its German rival Delivery Hero took a 5.09% stake in the UK food delivery company.
Britain’s largest fund supermarket, Hargreaves Lansdown, fell 9.8% to the bottom of the FTSE 100 after missing earnings estimates, while attracting record new customers thanks to growing retailer participation.
(Reporting by Shashank Nayar in Bangalore; Editing by Subhranshu Sahu and Ramakrishnan M.)