* FTSE down 0.5 pct in late session trading
* Remy profit warning hurts SAB Miller and Diageo
* Most traders still expect year-end rally
By Sudip Kar-Gupta
LONDON, Nov 26 Britain's benchmark equity index
fell on Tuesday, pulled down by major drink stocks such as SAB
Miller and Diageo on signs of slowing consumer
demand in China.
Many traders said nevertheless that any market weakness in
November would be followed by a rally in December that could
push the index back to its 2013 peaks.
The blue-chip FTSE 100 index was down 0.5 percent,
or 36.33 points, at 6,658.29 points in late session trading.
SAB Miller and Diageo together took the most points off the
index after a profit warning at rival Remy Cointreau,
which slumped 9.6 percent after warning of a slowdown in China.
Tim Gregory, head of global equities at Psigma Investment
Management, said that even though the drinks sector faced
near-term challenges, its longer-term outlook remained more
Many analysts expect drinks groups to gradually cash in on
rising consumer demand in areas such as China and India.
"Although there are clearly short term headwinds for the
high-end spirits market, the long term opportunity for the
industry is still strong, so we would see any short term
weakness in stocks like Diageo as an opportunity to buy the
shares," said Gregory.
The FTSE remains up by around 13 percent since the start of
2013. It reached a five-month peak of around 6,800 points in
late October, having hit a 13-year peak of 6,875.62 points in
late May, helped by a gradual recovery in the British economy.
"We're still expecting a year-end rally, but we won't buy
unless it either falls to 6,600 points or if it holds above
6,700," said Logic Investments director of trading Darren
APS Alpha technical strategist Adrian Slack also expected
the FTSE to get back to the 6,800 level in December.
Slack added that if it rose above that, it could then
challenge the 7,000 point level by the end of 2013, which would
represent an all-time high for the index.