Precious metal miners are losing their lustre, helping undermine the market’s attempts to reach new record highs.
The FTSE 100, having reached an intraday record of 7129.83, is now down around 8 points at 7089. An opening fall on Wall Street has not helped, with the Dow Jones Industrial Average now down 94 points or 0.5% after a disappointing update from Alcoa.
But one of the main factors for the decline is a fall in gold and silver as the dollar continues to climb on the basis that US interest rates may soon be increased. More clues could come from the minutes of the last Federal Reserve meeting, due to be released on Wednesday.
So Mexican miner Fresnillo has fallen 41p to £16.44, Randgold Resources is down 165p to £69 and, in the mid-cap index, the top three losers are Hochschild, 14.4p lower at 252.8p, Egyptian gold miner Centamin, down 7.6p at 147.8p and Africa’s Acacia Mining, off 14.1p at 461.8p.
Meanwhile the biggest faller in the FTSE 100 remains Old Mutual, down 11.5p at 197.8p on disappointment with its presentation to City investors, as well as a fall in the rand after South Africa’s finance minister was ordered to appear in court next month.
Connor Campbell, financial analyst at Spreadex said:
After the excitement of a fresh all-time intraday peak for the FTSE things have calmed down somewhat, the US open bringing in a wave of investors who aren’t purely Brexit-focused.
A lunchtime surge saw the FTSE smash through to 7129; now it’s back hovering below 7100, that midday burst of energy proving to be brief. Perhaps reports that both Citi and Morgan Stanley have stated they will leave London if Britain appears to be heading for a hard Brexit have weighed on investors’ appetite for the UK index; perhaps it was a bout of profit-taking. Either way the FTSE couldn’t hold onto its highs for long.
