- Cautious mood ahead of EU summit
- Spain officially asks for EU aid
- Shire finishes down 11 per cent on generic competition issues

Mining stocks were dragging London's FTSE 100 sharply lower on Monday, as investors sold off 'riskier' assets. However, it was Shire that finished the day as the worst performer on the blue-chip index on the back of competition concerns arising from a generic version of one of its drugs.

Investors have been looking ahead to the crucial European Union (EU) summit on June 28-29th with caution; European leaders are to discuss specific steps towards a cross-border banking union, closer fiscal integration and the possibility of a debt redemption fund, according to reports.

The euro was trading at a one-week low on Monday afternoon following comments by George Soros and ahead of new debt auctions by Spain and Italy on Tuesday. The billionaire investor said that the single currency could disappear if European leaders do not make some important decisions in this week's summit. He suggested that the EU put in place a fund to buy Spanish and Italian bonds and for a European Fiscal Authority to be created.

"Investors want decisive action, and another round of brinksmanship from Germany in terms of its calls for further austerity for indebted nations would likely cause further market turbulence," said Martin Arnold, a senior analyst at ETF Securities.

Spain's Ministry of Economy formally announced the request for "financial assistance for the Spanish banking system" today in a letter sent to Eurogroup President Jean-Claude Juncker. Though no specific amount was requested, independent audits last week revealed that the country's banks would need up to €62bn.

"The Rajoy Government will soon need to digest the specific bank reforms that the EU will demand as a condition for the bailout - this will not be an agreeable discussion and has plenty of potential to contribute to market uncertainty," said Michael Derks, the Chief Stategist at FxPro.

FTSE 100: Shire leads Footsie lower


Shares in pharmaceutical giant Shire tanked after the US Food and Drug Administration approved a rival's application to make a generic version of its attention deficit and hyperactivity disorder (ADHD) drug, Adderall XR. Panmure Gordon reduced its target price for Shire this morning after cutting its sales estimates for Adderall XR, saying that it now expects "this business to shrink precipitously".

Following Shire lower were mining stocks as investors fled from risk ahead of the EU summit. Stocks in the sector have fallen an average 5% of the past week and are down 17% on a three-month basis. Compared with a year ago, the sector average has slipped some 31%. Evraz, Kazakhmys, ENRC and Rio Tinto were firmly out of favour with the latter falling despite announcing that it has begun shipping coal out of Mozambique, the first step towards the company becoming a significant supplier of hard coking coal to the seaborne market.

Bucking the sector trend was precious metals group Polymetal International after Nomura upgraded the stock by two notches from 'reduce' to 'buy', saying that "now that Polymetal has passed the FTSE re-weighting, we believe that these [current] levels provide a decent entry point."

Utilities stocks were proving popular today as they benefitted from their 'safe-haven' appeal: Centrica, Severn Trent, National Grid and International Power were among the few stocks making gains.

FTSE 250: Gold miners in demand, Essar drops


Gold miners Centamin and Petropavlovsk were benefiting from bullish remarks from Nomura about the gold sector. "Gold remains fundamentally supported by long-term trends", including increasing gold holdings within central bank reserves and strong Chinese demand.

Essar Energy, the India-focused integrated energy company, was in the red despite saying that the first of two 255MW units at its Vadinar Phase 2 power plant has been synchronised with the transmission grid.

Industrial property specialist Segro fell after selling four "non-core" industrial estates for £204.5m.



FTSE 100 - Risers
Hargreaves Lansdown (HL.) 513.00p +2.40%
Polymetal International (POLY) 925.00p +1.26%
Vodafone Group (VOD) 178.60p +0.56%
Centrica (CNA) 308.60p +0.49%
National Grid (NG.) 661.00p +0.38%
Severn Trent (SVT) 1,610.00p +0.25%
Compass Group (CPG) 652.50p +0.23%
United Utilities Group (UU.) 647.00p +0.15%
GlaxoSmithKline (GSK) 1,478.50p +0.14%
Next (NXT) 3,180.00p +0.09%

FTSE 100 - Fallers
Shire Plc (SHP) 1,743.00p -11.34%
Evraz (EVR) 254.70p -5.03%
Aviva (AV.) 263.20p -4.15%
ICAP (IAP) 357.00p -4.03%
Kazakhmys (KAZ) 674.00p -3.99%
Rio Tinto (RIO) 2,872.50p -3.67%
Eurasian Natural Resources Corp. (ENRC) 400.00p -3.45%
IMI (IMI) 821.00p -3.24%
Barclays (BARC) 194.25p -3.21%
Lloyds Banking Group (LLOY) 30.41p -3.12%

FTSE 250 - Risers
Centamin (DI) (CEY) 68.85p +6.66%
Micro Focus International (MCRO) 507.00p +3.79%
Domino's Pizza Group (DOM) 511.50p +2.10%
Menzies(John) (MNZS) 575.00p +1.50%
Marston's (MARS) 101.50p +1.30%
Dixons Retail (DXNS) 17.48p +1.27%
Halma (HLMA) 415.20p +1.19%
Petropavlovsk (POG) 460.00p +1.03%
Stobart Group Ltd. (STOB) 117.60p +0.94%
Greene King (GNK) 524.00p +0.87%

FTSE 250 - Fallers
Essar Energy (ESSR) 116.00p -7.79%
International Personal Finance (IPF) 238.30p -7.10%
Talvivaara Mining Company (TALV) 160.30p -6.91%
Halfords Group (HFD) 234.30p -6.91%
Kenmare Resources (KMR) 38.69p -6.86%
Phoenix Group Holdings (DI) (PHNX) 453.10p -6.50%
Imagination Technologies Group (IMG) 455.00p -5.58%
Heritage Oil (HOIL) 119.30p -5.54%
Soco International (SIA) 281.20p -5.03%
Domino Printing Sciences (DNO) 509.00p -4.86%

BC

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Centrica (CNA) share price
Rio Tinto (RIO) share price
Severn Trent (SVT) share price
Shire Plc (SHP) share price
SEGRO (SGRO) share price
International Power (IPR) share price
Centamin (DI) (CEY) share price
Petropavlovsk (POG) share price
National Grid (NG.) share price
Kazakhmys (KAZ) share price
Eurasian Natural Resources Corp. (ENRC) share price
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Polymetal International (POLY) share price
Evraz (EVR) share price