- Miners lower as investors digest China trade data
- Japanese growth estimates lowered for Q3
- Tullow disappoints after abandoning well
techMARK 2,677.57 +0.26%
FTSE 100 6,539.02 -0.20%
FTSE 250 15,341.86 +0.16%
Weakness in the heavyweight mining sector kept London's FTSE 100 index in the red on Monday morning despite some strong export data from top metals consumer China.
Asian markets performed well overnight after the news that export growth in China accelerated strongly in November. The year-on-year increase in exports accelerated to 12.7% last month, from 5.6% in October and well ahead of the 7% growth expected by analysts.
The country's trade surplus widened to a five-year high of $33.8bn, from $31.1bn previously and ahead of forecasts. However, import growth fell markedly from 7.6% to 5.3%, worse than the slowdown to 7% expected by analysts.
"Of course for the miners, the concern is imports not exports, and while import growth continues to lag the demand outlook for the sector weakens," said Toby Morris, Senior Sales Trader at CMC Markets.
"This isn't the first time the FTSE has faced a headwind from the heavyweight miners in the last week, and with major resource futures in the green it makes the move all the more painful for investors," he said.
Data from Japan was also a cause for concern with estimates for third-quarter gross domestic product (GDP) growth being revised sharply lower to an annualised rate of 1.1%. This compares with the initial estimate of 1.9% in November and came in well below the 3.6% pace of growth registered in the second quarter. The revision was mainly due to lower estimates for investment and higher inventories by companies.
Markets were still digesting the US jobs report, which sparked strong gains on Friday on hopes that the economic recovery Stateside may be solid enough to warrant a reduction in stimulus by the Federal Reserve. The Fed's next policy meeting is on December 17-18th.
US non-farm payrolls increased by 203,000 in November, compared with a revised 200,000 gain the month before and well ahead of the consensus forecast for 185,000. Meanwhile, the unemployment rate fell to 7% from 7.3%, below the 7.2% rate estimated by analysts.
"Friday's reaction suggests that markets are either confident that the taper won't come until next year, which would be surprising given the recent figures we've seen from the US, or that a taper is mostly priced in an investors are comfortable with it. If the latter is true, it could mean we've seen the end, for now at least, of the good news is bad news scenario," said Market Analyst Craig Erlam from Alpari.
Miners under the weather, Tullow drops after abandoning well
Mining stocks were under heavy selling pressure this morning with Vedanta, Fresnillo and Antofagasta all registering steep losses. Randgold, Rio Tinto and Anglo American were also lower.
Oil group Tullow was also among the worst performers after saying it has plugged and abandoned its Tultule-1 wildcat well onshore Ethiopia as it failed to encounter oil.
HSBC was lower on rumours that it is thinking about a flotation of its UK arm. Reports, later reportedly denied by the bank, said that it has been talking to investors regarding possible demand should it decided to list a stake of up to 30% in its UK retail and commercial banking operations.
Sector peer Lloyds also declined after a downgrade by Beaufort Securities to 'hold'. The bank announced this morning that it has sold a portfolio of UK corporate real estate loans as part of its continued non-core asset reduction programme.
Kentz gained strongly after offering $435m for the oilfield solutions business of US-based Valerus as it looks to expand its offering and increase its footprint in the Americas regions.
WPP rose after saying that it has acquired semantic advertising solutions group Crystal Semantics, strengthening its digital media and mobile advertising business.
Satellite operator Inmarsat was higher after announcing a successful launch of its first Global Xpress satellite - "a major landmark on our journey to deliver the world's first globally available, high speed mobile broadband service," according to Chief Executive Rupert Peace.
FTSE 100 - Risers
International Consolidated Airlines Group SA (CDI) (IAG) 365.10p +2.10%
Aviva (AV.) 427.90p +2.03%
Shire Plc (SHP) 2,742.00p +1.22%
Sports Direct International (SPD) 760.00p +1.13%
Travis Perkins (TPK) 1,743.00p +0.98%
Hargreaves Lansdown (HL.) 1,218.00p +0.74%
Capita (CPI) 997.00p +0.71%
WPP (WPP) 1,323.00p +0.68%
Rolls-Royce Holdings (RR.) 1,203.00p +0.67%
TUI Travel (TT.) 380.20p +0.56%
FTSE 100 - Fallers
Vedanta Resources (VED) 816.00p -3.37%
Tullow Oil (TLW) 872.00p -3.06%
Fresnillo (FRES) 735.50p -2.84%
Petrofac Ltd. (PFC) 1,168.00p -2.18%
Antofagasta (ANTO) 752.50p -2.15%
Randgold Resources Ltd. (RRS) 3,965.00p -1.83%
Aggreko (AGK) 1,601.00p -1.36%
ARM Holdings (ARM) 1,006.00p -1.18%
Anglo American (AAL) 1,310.50p -1.09%
Barclays (BARC) 262.90p -1.04%
FTSE 250 - Risers
Kentz Corporation Ltd. (KENZ) 642.00p +10.31%
Inmarsat (ISAT) 727.50p +5.36%
Crest Nicholson Holdings (CRST) 363.20p +3.95%
RPC Group (RPC) 552.00p +3.86%
Xaar (XAR) 1,104.00p +3.66%
Carpetright (CPR) 540.00p +3.45%
Wetherspoon (J.D.) (JDW) 698.50p +2.72%
Tullett Prebon (TLPR) 329.70p +2.11%
Oxford Instruments (OXIG) 1,530.00p +2.00%
Renishaw (RSW) 1,859.00p +1.86%
FTSE 250 - Fallers
Kazakhmys (KAZ) 209.80p -3.67%
Petra Diamonds Ltd.(DI) (PDL) 110.20p -3.25%
Domino's Pizza Group (DOM) 469.00p -2.29%
Ophir Energy (OPHR) 320.40p -2.23%
Centamin (DI) (CEY) 45.08p -1.91%
Telecom Plus (TEP) 1,750.00p -1.80%
Evraz (EVR) 102.00p -1.73%
Marston's (MARS) 144.90p -1.50%
Victrex (VCT) 1,563.00p -1.45%
Essar Energy (ESSR) 73.25p -1.41%