London close: Mining stocks drop to push FTSE lower

LONDON (ShareCast) - (ShareCast News) - Mining shares slumped to push London stocks into the red on Tuesday, as commodity prices fell. Glencore (Xetra: A1JAGV - news) was the top faller on the FTSE 100 as Credit Suisse (Other OTC: CDSSF - news) said weak demand from China and emerging markets would continue to drag on the sector.

Credit Suisse added that iron ore was set to do worst from current levels while copper prices were seen "hovering" around the top-end of the cost curve (220 US cents) until a deficit reappeared in the market, towards 2018. The price of copper was now seen averaging $5,673 per tonne in 2015, compared to a previous estimate of $6,126 per tonne.

Antofagasta (Other OTC: ANFGF - news) and Anglo American (LSE: AAL.L - news) also declined on downgrades from Credit Suisse.

Tuesday data In another downside to UK markets, manufacturing output stalled in September for the first time in two years, according to the Confederation of British Industry's (CBI) industrial trends survey. The total orders sub-index fell to a reading of -7% (consensus: 0), higher than the long-run average of -15% but a decline from the -1% reading seen in August. CBI economics director Rain Newton-Smith described exports as "the missing link in the UK recovery".

"With the strong pound squeezing manufacturers' margins, even though lower commodity prices are helping to ease cost pressures," Newton-Smith said.

"Meanwhile manufacturers will have an eye on China's slowdown and its effect on neighbouring markets." Elsewhere in the UK, the Office for National Statistics revealed public sector net borrowing, excluding public sector banks, rose by £1.4bn in August to £12.1bn compared with a year ago. The ONS said the increase in net borrowing was driven by a £1.6bn in central government borrowing, halting Osborne's plans to cut the deficit.

Meanwhile, Chancellor George Osborne said the nation and China are looking into ways of linking their stock markets.

The proposal is for Chinese and British shares to be traded in both countries. A "landmark feasibility study" will be conducted on the suggestion, Osborne announced in a speech at the Shanghai Stock Exchange.

Osborne said the nations would work together despite a slowdown in China's economy. The Shanghai index has fallen almost 40% since June.

Across the Atlantic, US house prices edged higher in July, according to the Federal Housing Finance Agency. Prices in the US rose 0.6% month-on-month in July, compared with a 0.2% increase in the previous month and with the 0.4% hike analysts had expected. The increase took the year-on-year gain to 5.8%, the report added.

Still to come, US Federal Reserve official Dennis Lockhart will speak at 2230 BST in Alabama and analysts will be looking for further clues on interest rates.

On Monday, the policymaker said the risks of the Fed waiting to raise interest rates were not significant. He believed the central bank should delay a hike until it was clear that global economic uncertainty would not hurt the US economy.

"I don't think those risks are significant," Lockhart said.

Tesco (Xetra: 852647 - news) slumps In company news, Tesco plunged as Sky News reported that the supermarket's CEO is to hold talks with advisers this week about abandoning the sale of the Dunnhumby business.

RSA Insurance Group rebounded from falls on Monday after confirming Scott Egan will begin as chief financial officer next month and amid news that Zurich Insurance (Xetra: ZFI1.DE - news) has ended offer talks with the London-listed insurer.

Royal Bank of Scotland (LSE: RBS.L - news) dropped on news the lender and General Electric are in talks to sell $4.5bn of Italian non-performing loans.

HSBC dipped as Goldman Sachs (NYSE: GS-PB - news) said the bank is bit of an underachiever when it comes to managing the 'micro' but stands to gain from a big macroeconomic tailwind as US interest rates rise.

IG Group (Other OTC: IGGHY - news) advanced after the trading firm posted an increase in revenue in the first three months of the year, although it warned market volatility had made it harder to predict an outcome for the full year.

Polymetal International (Other OTC: AUCOY - news) was also on the front foot after the company said it has reached an agreement to settle the Kyzyl gold project put option for a net consideration of $68m.

Kaz Minerals (LSE: KAZ.L - news) tumbled after Credit Suisse downgraded the stock to 'neutral' and cut its price target Science and technology company Allied Minds (Other OTC: ALLWF - news) slumped after US hedge fund Kerrisdale Capital outlined the reasons for its short position in the stock.

FTSE 100 - Risers RSA Insurance Group (RSA) 408.20p +1.22% Smith & Nephew (LSE: SN.L - news) (SN.) 1,167.00p +0.17% FTSE 100 - Fallers Glencore (Amsterdam: GX8.AS - news) (GLEN) 107.20p -9.92% Johnson Matthey (LSE: JMAT.L - news) (JMAT) 2,310.00p -8.41% Antofagasta (LSE: ANTO.L - news) (ANTO) 528.00p -6.63% Anglo American (AAL) 651.50p -6.25% GKN (GKN (LSE: GKN.L - news) ) 256.60p -5.77% BHP Billiton (NYSE: BBL - news) (BLT) 1,029.00p -4.37% Shire Plc (Xetra: S7E.DE - news) (SHP) 4,601.00p -4.05% Hikma Pharmaceuticals (LSE: HIK.L - news) (HIK) 2,394.00p -3.86% AstraZeneca (Swiss: AZN.SW - news) (AZN) 4,212.50p -3.80% International Consolidated Airlines Group SA (CDI) (IAG) 572.50p -3.70% FTSE 250 - Risers IG Group Holdings (IGG (HKSE: 8002.HK - news) ) 756.50p +3.00% Rank Group (RNK) 271.90p +1.72% Zoopla Property Group (WI) (ZPLA) 215.00p +1.37% NMC Health (LSE: NMC.L - news) (NMC (Other OTC: NMCX - news) ) 818.50p +1.30% Halfords Group (LSE: HFD.L - news) (HFD) 457.00p +1.11% Polymetal International (POLY) 540.00p +0.84% Indivior (Berlin: 2IV.BE - news) (INDV) 220.80p +0.64% Betfair Group (LSE: BET.L - news) (BET) 3,227.00p +0.53% TalkTalk Telecom Group (TALK) 315.50p +0.48% CLS Holdings (LSE: CLI.L - news) (CLI) 1,833.00p +0.44% FTSE 250 - Fallers Kaz Minerals (KAZ) 108.70p -22.19% Allied Minds (ALM) 450.00p -12.62% Premier Oil (LSE: PMO.L - news) (PMO) 63.70p -11.03% AA (AA.) 297.10p -10.86% Petra Diamonds Ltd (LSE: PDL.L - news) .(DI (KSE: 003160.KS - news) ) (PDL) 92.40p -8.61% Vesuvius (VSVS) 339.00p -6.87% Vedanta Resources (Other OTC: VDNRF - news) (VED) 476.90p -6.76% Bodycote (BOY) 548.00p -6.00% Mitchells & Butlers (LSE: MAB.L - news) (MAB) 330.70p -5.89% Senior (SNR) 248.60p -5.80% FTSE TechMARK - Risers NCC Group (LSE: NCC.L - news) (NCC (BSE: NCC6.BO - news) ) 268.75p +1.61% Sepura (SEPU) 174.00p +0.58% IShares Euro Gov Bond 7-10YR UCITS ETF (IEGM) € 202.27 +0.45% FTSE TechMARK - Fallers Oxford Instruments (Other OTC: OXGGY - news) (OXIG) 556.00p -4.47% SDL (SDL (LSE: SDL.L - news) ) 345.25p -2.75% Spirent Communications (Other OTC: SPMYY - news) (SPT (Taiwan OTC: 8431.TWO - news) ) 74.00p -1.99% Consort Medical (Other OTC: CSRMY - news) (CSRT) 920.50p -1.66% Triad Group (Stuttgart: TD8.SG - news) (TRD) 35.75p -1.38% BATM Advanced Communications Ltd (Other OTC: BTAVF - news) . (BVC) 18.50p -1.33% Dialight (DIA (Amsterdam: DI6.AS - news) ) 637.00p -1.24% E2V Technologies (LSE: E2V.L - news) (E2V) 236.00p -1.15% Gresham Computing (LSE: GHT.L - news) (GHT) 112.00p -0.89% KCOM Group (LSE: KCOM.L - news) (KCOM) 90.00p -0.83% Market Movers techMARK 2,984.62 -2.45% FTSE 100 5,940.72 -2.75% FTSE 250 16,543.04 -2.07% FTSE 100 - Risers RSA Insurance Group (RSA) 405.60p +0.57% FTSE 100 - Fallers Glencore (GLEN) 105.75p -11.13% Johnson Matthey (JMAT) 2,319.00p -8.05% Antofagasta (ANTO) 525.50p -7.07% Anglo American (AAL) 649.00p -6.61% GKN (GKN) 255.70p -6.10% Shire Plc (SHP) 4,545.00p -5.21% Carnival (CCL) 3,333.00p -4.93% BHP Billiton (BLT) 1,023.50p -4.88% AstraZeneca (AZN) 4,168.50p -4.81% Tesco (TSCO) 168.35p -4.62% FTSE 250 - Risers IG Group Holdings (IGG) 753.50p +2.59% Rank Group (RNK) 271.50p +1.57% Nostrum Oil & Gas (Stuttgart: 3NO.SG - news) (NOG (Taiwan OTC: 5279.TWO - news) ) 508.50p +1.50% Polymetal International (POLY) 540.50p +0.93% NMC Health (NMC) 814.50p +0.80% Murray International Trust (MYI) 831.50p +0.73% CLS Holdings (CLI) 1,838.00p +0.71% Euromoney Institutional Investor (ERM) 1,041.00p +0.68% NB Global Floating Rate Income Fund Ltd GBP (NBLS) 95.20p +0.47% P2P Global Investments C (P2P2) 1,031.00p +0.39% FTSE 250 - Fallers Kaz Minerals (KAZ) 104.60p -25.13% Allied Minds (ALM) 440.00p -14.56% AA (AA.) 293.20p -12.03% Premier Oil (PMO) 63.65p -11.10% Petra Diamonds Ltd.(DI) (PDL) 91.30p -9.69% Vedanta Resources (VED) 468.80p -8.35% Mitchells & Butlers (MAB) 326.80p -7.00% Vesuvius (VSVS) 339.80p -6.65% Bodycote (BOY) 544.50p -6.60% AO World (Other OTC: AOWDF - news) (AO.) 152.30p -6.51% FTSE TechMARK - Risers NCC Group (NCC) 268.50p +1.51% Sepura (SEPU) 174.50p +0.87% IShares Euro Gov Bond 7-10YR UCITS ETF (IEGM) € 202.38 +0.50% Ricardo (RCDO) 900.00p +0.17% Torotrak (TRK) 6.25p +0.08% FTSE TechMARK - Fallers Oxford Instruments (OXIG) 551.00p -5.33% SDL (SDL) 344.00p -3.10% KCOM Group (KCOM) 88.50p -2.48% Triad Group (TRD) 35.50p -2.07% Oxford Biomedica (LSE: OXB.L - news) (OXB) 8.83p -1.89% Dialight (DIA) 635.00p -1.55% Consort Medical (CSRT) 923.50p -1.34% BATM Advanced Communications Ltd. (BVC) 18.50p -1.33% E2V Technologies (E2V) 236.00p -1.15% Spirent Communications (SPT) 74.75p -0.99%