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London close: Late rally not enough as FTSE 100 falls for fourth straight day

Wed, 02nd Oct 2013 16:43

A slight bounce in the UK-listed mining sector saw the FTSE 100 rally on Wednesday afternoon but the index still finished firmly in the red, setting a fresh one-month low as political uncertainty in the US and Italy continued to weigh on sentiment.The FTSE 100 finished down 22.51 points at 6,437.5, its fourth consecutive session in negative territory. London's benchmark index now stands at levels not seen since August 30th when it closed at 6,412.93."Global markets are notably softer today, as yesterday's investor complacency is replaced with caution. With quarter-end and continuing uncertainty about the longevity of the US government shutdown, investors have resolved to take some profits," said Brenda Kelly, Senior Market Strategist at IG.Markets largely gave a subdued reaction to the European Central Bank (ECB) today which left its benchmark interest rate unchanged at 0.5%, as expected. Comments from Mario Draghi also came as no surprise as the ECB President expressed his commitment to keep rates low for an extended period and said it stands ready to take action if necessary down the track.Meanwhile, the ADP report in the States showed that just 166,000 private jobs were added in September following a revised 159,000 gain August. Analysts were expecting a rise of 180,000. Alex Young, Senior Sales Trader at CMC Markets, said that the ADP data had "greater significance than the private payroll figure is normally afforded" after it was revealed that the US Federal Bureau of Statistics will not be releasing Friday's official employment report due to the shutdown.US and Italian politics in focusThe partial shutdown of the US government continues to grab headlines today as Democrats and Republicans wrangle over the budget. The first shutdown in 17 years has seen some 800,000 federal workers put on unpaid leave for a second straight day today as the government shuts down non-essential agencies indefinitely.The shutdown is expected to shave 0.1 percentage point from economic growth, according to Bloomberg's median estimate of economists, with costs rising if the closure continues.While investors continue to gauge the impact of the shutdown on economic growth, the focus is now turning to the deadline of the debt ceiling on October 17th. If an agreement is not made to raise this limit, then the government will run out of the cash and will likely default on its debt obligations.Italian Prime Minister Enrico Letta has survived a confidence motion in Parliament moments after Silvio Berlusconi changed his mind about bringing down the coalition. According to Italian news agency Ansa, 235 senators gave their support for Letta while 70 were opposed and six members from Berlusconi's PDL party did not participate in the vote.Young from CMC Markets said the show of confidence "marked a humiliating U-turn for Berlusconi who faced a revolt from many of his most loyal backers in the Italian parliament. The soap opera continues..."FTSE 100: Supermarkets in focus after resultsSupermarket giant Tesco finished more or less flat today as it managed to almost erase all of its earlier losses following its interim results. Half-year underlying pre-tax profit fell 7.4% to £1.4bn as an improvement in the UK was offset by tough market conditions in Europe and Asia. Smaller rival Sainsbury finished lower despite the company saying it had outperformed rival retailers in its fiscal second quarter. The company reported a 5% increase in sales, accelerating from the 3.6% growth in the first three months of the year, as it continued to grow its market share.Sector peer Morrison was also trading in the red after going ex-dividend, meaning that from today investors will no longer be able to get their hands on the company's latest payout. Intertek, British Land and Weir also went ex-div today.DIY retailer Kingfisher finished with heavy losses, along with drinks bottling group Coca-Cola HBC.Leading the upside were utility stocks including National Grid, Severn Trent, SSE and Centrica. Meanwhile miners recovered after some early falls this morning as metal prices gained - Randgold, Vedanta, Glencore Xstrata, BHP Billiton and Anglo American were among the best performers by the close.Banking group Barclays was in demand after Societe Generale upgraded its rating to 'buy'. However, sector peers RBS, Lloyds, HSBC and Standard Chartered finished with losses.Natural gas giant BG Group was up after it said it found 'excellent' results from its completed drill-stem test in its part-owned Pweza gas field offshore southern Tanzania. Oil major Shell however fell despite saying it has produced oil from the second phase of production at its much sought-after Parque das Conchas project offshore Brazil.FTSE 250: SOCO jumps after update on VietnamSOCO International rose strongly after it said testing of the TGT-10XST1 exploration well on the H5 fault block of the Te Giac Trang field in Vietnam exceeded expectations. The well flowed at a combined average maximum production from the three zones tested at more than 27,600 barrels of oil equivalent per day.Soft furnishings retailer Dunelm said soaring temperatures eroded sales at the start of the quarter, causing shares to take a hit today. The firm said that first-quarter like-for-like (LFL) sales were down 5.3%. The hot weather also slowed down sales growth at Domino's Pizza, but the stock gained as investors were reassured by LFL sales growth in all its four markets during the third quarter. Mining group Hochschild was a heavy faller after saying it would raise up to $96m via an equity placing to help fund the buy-out of two of its assets in Peru for $280m.FTSE 100 - RisersNational Grid (NG.) 743.00p +1.64%Vedanta Resources (VED) 1,090.00p +1.40%Randgold Resources Ltd. (RRS) 4,396.00p +1.34%Anglo American (AAL) 1,502.50p +1.21%BHP Billiton (BLT) 1,826.00p +1.16%Fresnillo (FRES) 935.00p +1.14%Glencore Xstrata (GLEN) 334.15p +1.10%Rio Tinto (RIO) 3,028.00p +1.07%IMI (IMI) 1,475.00p +1.03%Barclays (BARC) 272.55p +1.02%FTSE 100 - FallersKingfisher (KGF) 376.90p -3.23%Coca-Cola HBC AG (CDI) (CCH) 1,771.00p -2.96%Intertek Group (ITRK) 3,266.00p -2.62%Smiths Group (SMIN) 1,382.00p -2.61%Shire Plc (SHP) 2,446.00p -2.36%ITV (ITV) 174.70p -2.24%Aggreko (AGK) 1,508.00p -2.14%Pearson (PSON) 1,225.00p -2.00%Tullow Oil (TLW) 1,011.00p -1.94%Morrison (Wm) Supermarkets (MRW) 274.80p -1.79%FTSE 250 - RisersSoco International (SIA) 415.60p +4.42%Domino's Pizza Group (DOM) 610.50p +3.65%Polymetal International (POLY) 648.00p +3.43%African Barrick Gold (ABG) 158.90p +2.85%Redrow (RDW) 239.50p +2.13%Carillion (CLLN) 315.70p +2.10%Kazakhmys (KAZ) 262.00p +2.06%Hiscox Ltd (HSX) 668.00p +2.06%COLT Group SA (COLT) 119.00p +1.97%Kenmare Resources (KMR) 28.50p +1.79%FTSE 250 - FallersHochschild Mining (HOC) 155.00p -11.17%Dunelm Group (DNLM) 880.00p -4.97%Ophir Energy (OPHR) 318.40p -3.95%Mitchells & Butlers (MAB) 389.30p -3.81%Keller Group (KLR) 1,006.00p -3.55%Xaar (XAR) 795.00p -3.52%Genus (GNS) 1,400.00p -3.45%Smith (DS) (SMDS) 277.70p -3.14%Daejan Holdings (DJAN) 4,075.00p -2.98%Chemring Group (CHG) 295.50p -2.92%BC
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