Mining rout propels FTSE lower

Heading into the close the FTSE has fallen over 100 points, as miners and Rolls-Royce lead a broad-based rout.

Canary Wharf, London
Source: Bloomberg

The week continues to see more losses for equity indices, with the FTSE 100 registering a sharp fall. A stronger dollar has put commodity prices on the back foot, which has translated into the usual weakness for miners in London, but Glencore has once again commanded attention, falling 9% on the day.

The firm is back below 100p per share, as investors read across from rival Noble Group’s abysmal results, factor in the poor Chinese data from earlier in the week and draw their own conclusions. Glencore’s sole consolation is that it is hardly alone, with Anglo American hard on its heels and all the other big names in the red too.

Rolls-Royce is being heavily punished as it broaches the  touchy subject of dividend payouts for shareholders, with oblique comments in its results this morning being taken as advance warning of potential cuts. This would leave investors with even fewer reasons to hold the shares; the shares are down by 50% over the past six months, but there appears to be no sign of bargain hunting just yet.

Mario Draghi continues to render the December European Central Bank meeting almost meaningless, as he drops increasing hints about more QE for the eurozone. While this helped to push the euro down once again, it did little for stock markets on the continent, which were more in tune with the US session.

The afternoon was dominated by a host of speeches by Fed policymakers, including the chief herself, and while Janet Yellen offered little, FOMC members Bullard and Lacker both reinforced the prevailing impression that the world’s most important central bank was increasingly comfortable with the idea of a December move. As a result, we saw the dollar pare losses, while the sell-off on Wall Street gathered  pace. 

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