FTSE ends lower, weaker miners outweigh bank rally
* FTSE 100 index closes 0.5 pct lower
* Antofagasta drags down miners
* Barclays leads banks higher
By Atul Prakash
LONDON, July 30 (Reuters) - Britain's top equity index finished lower on Wednesday as weaker mining stocks, dragged down by Chilean miner Antofagasta, outweighed a rally in banking stocks spurred by Barclays.
The UK mining index fell 1.6 percent, making it the worst performing sector. Antofagasta was down 4.6 percent, the biggest decline on the blue-chip FTSE 100 index.
The mining company, like others in copper, is battling declining ore grades, rising costs and weak metal prices. Its output dropped 4.4 percent in the first half of 2014 from a year earlier.
Chris Beauchamp, a market analyst at IG, said that investors questioned the rationale for increasing copper output when the broader market was expected to record surpluses.
"Couple that with rising labour costs and it looks like a grim future for Antofagasta shares," he said.
The FTSE 100 index ended 0.5 percent weaker at 6,773.44 points. Losses were limited by a 1.3 percent gain on the UK banking index.
Banks were led higher by Barclays, up 4.2 percent after it reported progress in cutting costs and hiving off assets. However, its underlying profits fell 8 percent in the second quarter as subdued market activity and its attempts to crack down on high-risk trading hit investment banking.
The bank added the most points to the FTSE 100 after some analysts said the drop in investment banking revenue was less severe than they predicted.
"There was a lot of caution ahead of Barclays' results, but it was no worse than many analysts were expecting. Lower operating costs are generally positive for banks in the current environment," Hargreaves Lansdown analyst Keith Bowman said.
Earnings news also helped Travis Perkins, up 2.7 percent, after Britain's No. 1 supplier of building materials posted a 19.4 percent rise in first-half profit, helped by improving market conditions and increased customer confidence.
Among other movers, British American Tobacco fell 1.2 percent, with the strong British pound and a slight decline in volume hitting its revenue and profit.
The broader market has come under pressure as the crisis in eastern Ukraine has threatened to boil over, most recently after Russian-backed rebels were blamed for the downing of a Malaysian passenger jet over Ukraine two weeks ago. (Additional reporting by Alistair Smout; Editing by Susan Fenton/Ruth Pitchford/Larry King)
- Dallas Ebola patient vomited outside apartment on way to hospital |
- Israel's Netanyahu to Obama: Don't allow Iran deal that leaves it at nuclear threshold
- First Ebola case diagnosed in the United States: CDC |
- Turkey vows to fight Islamic State, coalition strikes near border |
- Hong Kong leader plays waiting game, protesters demand he resigns |