FTSE 100 Slides Amid Middle East Crisis, Precious Metals Miners Lead Losses
Market Overview and Sector Performance
July 15 (Reuters) - London's FTSE 100 slipped on Wednesday as investors remained cautious over escalating tensions in the Middle East, while losses in precious metal miners outweighed gains in energy shares as oil prices rose.
The blue-chip FTSE 100 index fell 0.1% to 10,515.73 points by 1013 GMT, while the midcap FTSE 250 slipped 0.09%.
Sector Movements
Precious Metals Miners Lead Declines
• Precious metals miners declined 2.3%, making them the worst-performing sector, with Fresnillo and Endeavour Mining falling 2.8% and 2%, respectively, among the top losers on the benchmark index.
Energy Stocks Gain Amid Rising Oil Prices
• On the flip side, energy stocks rose 0.3% as oil prices climbed around 2% after U.S. President Donald Trump reimposed a naval blockade on all Iranian ports and Iran's Islamic Revolutionary Guard Corps threatened to close "all other export corridors that benefit the U.S. and its allies". [O/R]
Personal Goods Index Outperforms
• The personal goods index rose 2.4% to lead sectoral gains, buoyed by a 4.8% jump in Watches of Switzerland Group after brokerages Barclays and UBS lifted target price on the stock.
Economic and Political Context
OECD Recommendations for the UK
• The OECD said Britain must maintain fiscal discipline, tackle rising pension costs and address high energy prices to boost economic growth, underscoring the challenges facing Andy Burnham, who is set to become prime minister next week.
Previous Session Recap
• On Tuesday, Britain's FTSE 100 closed higher as bank stocks led gains after strong earnings from major U.S. lenders kicked off the reporting season, while a softer-than-expected U.S. inflation reading fuelled expectations of a delay in interest rate cuts.
Notable Movers
Mining and Retail Stocks
Rio Tinto
• Among individual stocks, Rio Tinto rose 1.1% after the mining major reported better-than-expected second-quarter iron ore sales, supported by strong operational performance.
B&M
• Shares of B&M fell 6.9% after the discount retailer reported a 2.3% decline in first-quarter like-for-like sales in its core UK market, as a slow start to the gardening season weighed on trading, though growth in France helped lift group revenue.
Barratt Redrow
• Barratt Redrow rose 3.3% after the housebuilder said it would return £400 million ($536 million) to shareholders through share buybacks instead of dividends.
(Reporting by Tharuniyaa Lakshmi in Bengaluru; Editing by Mrigank Dhaniwala)
