Miners, oil majors pull FTSE lower by midday

Fri Jul 3, 2009 6:40am EDT
 
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 * Miners fall as metal prices weaken
 * Oil majors slip on crude below $67
 * Reed Elsevier up on media sector upgrade
 * U.S. markets closed ahead of Independence Day
 
 By Farah Master
 LONDON, July 3 (Reuters) - Britain's leading share index was
0.2 percent lower by midday on Friday after poor U.S. jobs data
in the previous session mired market sentiment and lower
commodity prices weighed on miners and oil majors.
 By 1031 GMT the FTSE 100 index .FTSE was down 6.13 points
at 4,228.14 in subdued trading with U.S. markets closed on
Friday for the Independence Day holiday.
 "It's really, really quiet. The people we probably would
have seen in this market looking to buy from yesterday's lows
probably would have been here if it had not been for those
non-farms," said Joshua Raymond, market strategist at City
Index. 
 The British blue-chip index ended 106.44 points lower on
Thursday at 4,234.27, sliding with Wall Street after U.S. data
showed non-farm payrolls fell more than expected in June.
 "I think the non-farms have scared away anyone who was
looking to trade today. Historically when the U.S. is closed for
independence day, Europe tends to be really muted. That is
pretty much what we are seeing already and I don't think that is
going to change this afternoon," Raymond said
 Miners were the biggest drag on the index, as concern over
demand for metals on economic recovery uncertainties pushed
prices lower.
 Antofagasta (ANTO.L), Anglo American (AAL.L), BHP Billiton
(BLT.L), Xstrata (XTA.L), Vedanta Resources (VED.L), and Rio
Tinto (RIO.L) lost 0.9-2.8 percent.
 Underwriters to Rio Tinto's rights issue sold the Australian
"rump" at A$48.50 each, a 6.3 percent discount to Rio's last
traded price, Rio said in a statement on Friday.
  Oil majors fell as crude CLc1 stayed below $67 a barrel
after a nearly 4 percent fall on Thursday with the high jobless
numbers across the United States and Europe reviving concerns
about the global economic outlook and its impact on energy
demand.
 BP (BP.L), Royal Dutch Shell (RDSa.L), BG Group (BG.L),
Cairn Energy (CNE.L), and Tullow Oil (TLW.L) lost 0.3 to 1.4
percent.
 Elsewhere, Balfour Beatty (BALF.L) was down 2.2 percent
after the infrastructure company's in-line trading update failed
to inspire.
 
 MEDIA UPGRADE
 Media stocks were higher, led by Reed Elsevier (REL.L) after
Credit Suisse raised its rating on the European media sector to
"overweight" from "underweight," and said the sector has
significantly underperformed the market and valuations are now
at record lows. [ID:nBNG487801]
 BSkyB (BSY.L) was 0.8 percent higher, while WPP (WPP.L) was
up 1.3 percent.
 Banks also gained, rebounding after falls on Thursday.
 Royal Bank of Scotland (RBS.L) added 1.1 percent, with
Barclays (BARC.L), HSBC (HSBA.L) and Lloyds Banking Group
(LLOY.L) rising 0.9-1.2 percent
 Defensive issues also found support as investors' risk
appetite faded following the U.S. jobs disappointment, with
tobacco and drug issues moving higher.
 GlaxoSmithKline (GSK.L), AstraZeneca (AZN.L), and Shire
(SHP.L) rose 0.2-0.7 percent, while British American Tobacco
(BATS.L) and Imperial Tobacco (IMT.L) added 0.8 and 0.3 percent,
respectively.
 And British Airways (BAY.L) took on 1.3 percent ahead of the
airline's June passenger traffic numbers, due at 1315 GMT.
 There was little market reaction to data showing a slowing
in the recovery in the British service sector in June, with the
CIPS/Markit UK services PMI activity index reading of 51.6 below
May's 51.7 reading and the forecast of 52.0.
 (Reporting by Farah Master; Editing by Dan Lalor)

 

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