FTSE 100 fallers: why are the Fresnillo and British Land share prices down?

The precious metals miner had its stock downgraded by analysts from Goldman Sachs this week, while a slump in retail sales wiped 10% off British Land’s property values.

The FTSE 100 saw earlier gains eroded in the latter half of the week, driven by ex-dividend markdowns and US-China trade talks once again hitting some bumps in the road as the two countries attempt to phase out tariffs.

The blue-chip index fell 0.83% this week, losing more than 60 points over the last five sessions. Helping the Footsie with its descent this week is Mexican-based miner Fresnillo and property development and investment firm British Land, with the pair seeing their share prices fall 6% and 3% respectively.

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Goldman Sachs downgrades Fresnillo

Fresnillo’s share price was dragged lower this week after Goldman Sachs downgraded the stock to a ‘sell’ rating and set a target price of 580p a share.

The Mexican-based miner’s stock closed at at 624p on Friday. Based on that level, analysts at the US-based investment bank believe that the stock has a potential downside of 7%.

Earlier this year, the precious metals miner downgraded its gold production guidance, though last month the company admitted that it expects it will hit the lower end of the range.

Full-year 2019 silver and gold production likely to be at the lower end of the guided ranges of 55-58 moz silver and 880-910 koz gold respectively, the company said it its latest production report.

Quarterly gold production is down 6.9% compared with the same period last year due to lower grade and lower volume of ore processed at both Herradura and San Julián veins, as well as a lower volume of ore processed at Noche Buena.

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British retail crisis wipes 10% off British Land property values

It has been a tough week for British Land, whose real estate portfolio includes shopping centres like Drake Circus in Plymouth.

The company saw approximately £600 million wiped off the value of its portfolio over the last six months, with it also reporting a £440 million half-year loss driven by challenging market conditions faced by the retail sector.

All this has led to British Lands writing down the value of its retail investments by 10.7% ro £4.8 billion in its half-year results.

The tumbling value of British Land’s retail properties helped push the company to a loss of £440m, up from last year’s loss of £42m.

‘Looking forward, we expect our markets to remain uneven, but we have kept debt levels low, our balance sheet is strong and flexible, and we have a broad spread of expertise across our business,’ British Land CEO Chris Grigg said.

‘We expect retail to remain challenging, so we’ll focus on driving operational performance and maintaining occupancy,’ he added. ‘We see early signs that some liquidity may be returning to parts of the market, and our focus will remain on thoughtfully progressing our strategy to reduce exposure.’

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