Leading shares are heading lower on a combination of geopolitical and economic worries, and as usual in such circumstances, investors have turned to gold as a haven in the storm.
Gold has added $18 an ounce to $1213 while silver has also moved higher, helping precious metal miners buck the market’s slide.
Mexican miner Fresnillo is up 16p at 727p while Randgold Resources has risen 95p to £49.77.
Overall though the FTSE 100 has fallen sharply, currently down 75.90 points at 6915.07. Worries about Greece running out of money next month as it haggles with its creditors and prepare the demanded reforms continue to unsettle investors.
But growing tensions in the Middle East, with Saudi Arabia launching military action against rebels in Yemen, have added to the unease and pushed oil prices higher. Brent crude is now up more than 4% at $58.99 a barrel.
Of course this has helped lift the oil sector and companies associated with it. Weir - which supplies pumping equpment - is up 44p at £18.12 while BP is 3.5p better at 451.85p and BG has climbed 15.7p to 911.4p.
Another factor driving the decline is uncertainty over the US economy, with signs it may not be growing as strongly as expected after recent weak data, including durable goods figures on Wednesday. But at the same time the US Federal Reserve continues to talk about raising interest rates, albeit that the timing is still unclear. Tony Cross, market analyst at Trustnet Direct, said:
US durable goods data came in significantly worse than forecast, but with the Federal Reserve continuing to advocate the line that there’s still room for a rate hike in the summer, some investors appear to be taking fright at the prospect.
A number of companies went ex-dividend including Prudential, down 65.5p at 1676.5p, and Sky, 23.5p lower at 988.5p.
Easyjet has dropped 94p to £17.96 despite raising its first half profit forecasts, helped by favourable currency moves. But it warned that if exchange rates remained at current levels it would provide a reverse effect over the year.
Chip designer Arm continues to suffer from Wednesday’s tech sell-off in the US, partly on growth fears as well as a downgrade of US chipmaker Advanced Micro Devices by UBS. Arm is down another 56p to £10.71. Augustin Eden at Accendo Markets said:
Arm is down...this morning as Wednesday’s US tech stock sell off proves contagious and continues to spook the global markets. The US rout was led by the likes of Apple, Intel and Microsoft. Arm, which supplies the components that make Apple’s devices work, has been trading at highs recently but there are concerns that the markets for smartphones and tablets are becoming saturated leading to many consumers opting for cheaper devices with the same guts as fashionable market leaders, just without the badge. Crucially, these pay lower royalties to parts suppliers like Arm. With such tight competition in the sector, it’s hardly surprising that analysts are downgrading those stocks that supply an overpopulated market, seeing them as now overvalued.
But SuperGroup has soared 66.5p to £10 after it gained exclusive rights to distribute its products in the US.
