The FTSE 100 dipped lower on Friday morning with the heavyweight mining sector providing a drag as metals´ prices weakened across the board.
London's benchmark index opened with slight losses early on, pulling back from yesterday's close of 6,586.08 - its highest closing level since August 13th - as traders sit on their hands as they await a busy week next week.
Investors' appetite for risk is being scaled back ahead of the all-important Federal Open Market Committee two-day meeting which concludes next Wednesday with the Fed's next move highly uncertain following recent mixed economic data.
Last Friday's worse-than-expected jobs report sparked hopes that the Fed could delay scaling back quantitative easing at its September meeting, given that the central bank has explicitly called for a strong recovery in the labour market before it begins to 'taper'. However, last week's decline in US jobless claims to their lowest level since April 2006 revealed yesterday seems to have now dampened these hopes somewhat (though the figures were affected by one-off factors).
"With the Federal Reserve meeting next week to discuss potential reductions to monthly bond purchases, and with developments in Syria moving along at a snail's pace, it is understandable that investors are tempted to hold fire for the next week or so ," said Max Cohen, a Financial Sales Trader at Spreadex.
FTSE 100: Miners slump as metals weaken
Falling gold and silver prices hit mining stocks this morning. Gold in particular was at a five-week low and looks set to record its worst weekly loss since June as speculation ramps up about the Fed meeting. Gloomy comments on the precious metal from Goldman Sachs also weighed on prices today, with the bank saying that gold will slip to $1,050 an ounce next year from the current $1,316 level (as of this morning).
Randgold was among the worst performers on the FTSE 100, along with Anglo American, Rio Tinto, BHP Billiton and Antofagasta.
Glencore Xstrata was also lower after announcing a revised scope for its Zanaga iron ore project with a changed budget and efforts to finance work. The company said the project feasibility study is now being advanced on the basis of a staged development, substantially reducing the initial capital requirement and including the potential for initial production using existing infrastructure.
Vodafone edged higher after winning enough shareholder support for its €7.7bn takeover of German cable company Kabel Deutschland (KDH) to go ahead. The British mobile network giant has received the backing of more than 75% of Kabel shareholders.
FTSE 250: Imagination rises on licence deal; Kentz continues to fall
Imagination Technologies has signed a new licence agreement with MediaTek, a semiconductor company for wireless communications and digital multimedia, causing shares
to jump on friday. Under the multi-year agreement, MediaTek will continue to deliver products to the group's PowerVR Series6 division including graphical features such as OpenGL ES 3.0 support, while maintaining the low-power profile essential to mobile devices. MediaTek will be given access to graphics technology.
Kentz was weaker this morning after German firm M&W Group pulled out of a potential bid for the engineering and project management company. M+W is the second company in two days to decide against bidding for Kentz after Amec withdrew its intention on Thursday.
FTSE 100 - Risers
Reckitt Benckiser Group (RB.) 4,508.00p +1.26%
William Hill (WMH) 429.00p +1.16%
Babcock International Group (BAB) 1,200.00p +0.84%
Schroders (SDR) 2,472.00p +0.77%
easyJet (EZJ) 1,331.00p +0.76%
Smiths Group (SMIN) 1,370.00p +0.74%
RSA Insurance Group (RSA) 122.60p +0.74%
Standard Life (SL.) 343.00p +0.70%
Hargreaves Lansdown (HL.) 1,018.00p +0.69%
Intertek Group (ITRK) 3,415.00p +0.68%
FTSE 100 - Fallers
Anglo American (AAL) 1,585.00p -2.19%
Glencore Xstrata (GLEN) 336.90p -1.96%
Morrison (Wm) Supermarkets (MRW) 297.00p -1.82%
Vedanta Resources (VED) 1,161.00p -1.78%
Rio Tinto (RIO) 3,133.50p -1.66%
Randgold Resources Ltd. (RRS) 4,433.00p -1.40%
Fresnillo (FRES) 1,178.00p -1.34%
Antofagasta (ANTO) 852.50p -1.33%
BHP Billiton (BLT) 1,898.00p -1.30%
BG Group (BG.) 1,194.50p -1.08%
FTSE 250 - Risers
Imagination Technologies Group (IMG) 331.50p +7.84%
Fenner (FENR) 406.40p +4.93%
Bwin.party Digital Entertainment (BPTY) 113.90p +3.64%
Barratt Developments (BDEV) 321.80p +2.16%
Ashtead Group (AHT) 644.50p +1.50%
Salamander Energy (SMDR) 122.50p +1.32%
Restaurant Group (RTN) 577.50p +1.32%
TR Property Inv Trust (TRY) 212.90p +1.28%
Crest Nicholson Holdings (CRST) 329.10p +1.26%
Dignity (DTY) 1,486.00p +1.23%
FTSE 250 - Fallers
African Barrick Gold (ABG) 162.00p -3.34%
Ferrexpo (FXPO) 181.10p -2.90%
Polymetal International (POLY) 714.50p -2.79%
Kentz Corporation Ltd. (KENZ) 485.30p -2.75%
Pennon Group (PNN) 706.50p -2.75%
Centamin (DI) (CEY) 43.50p -2.25%
Lonmin (LMI) 336.70p -1.98%
Telecity Group (TCY) 824.50p -1.90%
Hochschild Mining (HOC) 273.20p -1.66%
Investec (INVP) 434.20p -1.59%