FTSE closes down 0.2 pct; banks, miners pressured

Mon Aug 10, 2009 12:04pm EDT
 
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* FTSE pauses after Friday's 10-month high

* Lloyds rights issue report pressures banks

* Miners lower after succumbing to profit takers

By Harpreet Bhal

LONDON, Aug 10 (Reuters) - Britain's top share index edged down on Monday pressured by miners and banks, with investors booking profits from hefty gains last week, while the market searched for direction as the earnings season tailed off.

The FTSE 100 .FTSE 100 ended down 0.2 percent, or 9.36 points at 4,722.20, not far from a 10-month closing high of 4,731.56 on Friday after reassuring non-farm payrolls numbers from the United States boosted investor sentiment.

A recovery in corporate earnings and improving macroeconomic data has fuelled a rally in British stocks over the past few weeks, with the index rebounding 36 percent since the all-time low in March, and has gained 2.5 percent so far this month.

"It is a small pause after the push up last week. Everyone is having a look to see whether it can continue after the big numbers on Friday. It will be a very interesting week whether it can hold on (to recent gains)," said Richard Griffiths, senior trader at Spreadex Ltd.

Miners were the biggest drag on the index, with Anglo American (AAL.L), Fresnillo (FRES.L), BHP Billiton (BLT.L), Kazakhmys (KAZ.L) and Eurasian Natural Resources (ENRC.L) off 2-4 percent.

Rio Tinto (RIO.L) shed 3.2 percent after China stepped up espionage allegations against the world's second-largest iron ore miner. [ID:nSYD489638]

Xstrata (XTA.L) lost 3.1 percent after the company said on Sunday it was in talks that could lead to it selling a major stake in a South African mining project. [ID:nL933859]

Banks were also under pressure after investor confidence was dented by a report in the Sunday Times about a possible share issue by Lloyds Banking Group (LLOY.L). The lender was the biggest blue-chip faller, losing 4 percent. [ID:nLA282962]

Royal Bank of Scotland (RBS.L) was off 3.6 percent after its glum results on Friday and Barclays (BARC.L) lost 1.8 percent. Standard Chartered (STAN.L) and HSBC (HSBA.L) rose 0.6 and 0.3 percent respectively.

ENERGY PRICES CLIMB   Continued...

 

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