London’s top-flight headed lower today as oil prices stabilised but disappointing economic data from China dragged on commodity stocks.
The FTSE 100 Index had been hit by a widespread sell-off in the previous session after a military flare-up in the Middle East pushed the price of a barrel of Brent crude towards $60.
The index was 22.8 points lower at 6872.5 today as the oil price edged down to around $58 but overnight figures from China showed a sharp decline in industrial profits.
It meant the FTSE 100 was on course for a fourth successive day of losses as the buoyant mood which saw it top the 7,000 landmark last week – and achieve further record highs at the start of this one – ebbed away.
On currency markets, the pound was bolstered by remarks from Bank of England governor Mark Carney that he expected the next move in interest rates to be up.
It echoed similar comments from a series of Bank policy makers this week offering reassurance over fears about the potential negative consequences of low inflation after figures showed it fell to zero in February.
Sterling rose a cent against the dollar at 1.49 and was also up by a cent against the euro at just over 1.37.
The single currency’s weakness helped boost shares in companies exporting from the continent, with Germany’s Dax and France’s Cac 40 both ahead.
In London, data from China, adding to concerns about a slowdown in the world’s second biggest economy, weighed on commodity stocks.
Anglo American led the top-flight fallers as it dropped 3%, or 35p, to 1041.5p, while Randgold Resources was not far behind, off 135.5p at 4766.5p. Glencore fell 7.2p to 290p with Rio Tinto down 66.8p to 2810.2p.
In corporate news, state-backed Royal Bank of Scotland agreed to sell the international arm of private bank Coutts to Switzerland’s Union Bancaire Privee, reportedly for up to 800 million US dollars (£584 million).
But RBS, 80% owned by the taxpayer, said it would result in a £200 million hit to first quarter results after taking into account restructuring and other charges. Shares fell 5.3p to 345p.
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