* FTSE 100 down 0.9 pct, around 1-month low
* Chinese credit concerns hit mining stocks
* Ex-dividends take around 20 points off index
By Tricia Wright
LONDON, March 12 Britain's top equity index fell
on Wednesday to hover around a one-month low as heightened
concerns over the credit market in China, the world's top metals
consumer, hit the mining sector for the fourth straight session.
The FTSE 350 Mining Index fell for the fourth
day in a row to trade 0.7 percent lower. The recent sell-off has
tipped the sector into negative territory for the year, down 1.7
Miners were hit as Shanghai futures fell by their 5
percent daily limit again and London Metal Exchange prices
dropped to their lowest since 2010.
The blue-chip FTSE 100 index, which had already
fallen in the last three sessions, was down by 57.43 points, or
0.9 percent, at 6,628.09 points by 1138 GMT.
A bond default last week by a Chinese solar company
reignited concerns about a possible economic slowdown in China,
which in turn has hit metal prices and mining stocks.
China's health is a key factor for the FTSE 100, given the
mining sector's heavy weighting. It is the fourth biggest sector
within the UK benchmark, accounting for almost 9 percent of the
index, data from index compiler FTSE showed.
Although the UK stock market has been propped up by a
gradual recovery in the British economy, some traders expected
the FTSE to remain under pressure in the near-term, with the
index down 1.8 percent since the start of 2014.
"The UK market remains vulnerable with especially the mining
sector under huge pressure... Unlikely that we have seen the
last of this and my preference would be to sell rallies," Lex
van Dam, hedge fund manager at Hampstead Capital, said.
Barclays Capital analyst Lynnden Branigan saw scope for the
UK benchmark, which has this week fallen below both its 50-day
and 100-day moving averages, to drop down to its 200-day moving
average, at 6,578, "within the next five days, for sure".
"There is a risk of a squeeze below, towards perhaps 6,500,"
The FTSE 100 rose 14.4 percent in 2013 to record its best
annual gain since 2009. It also reached peaks that marked its
highest level in around 13 years in early January this year.
A host of companies, including major banks HSBC and
Standard Chartered went ex-dividend on Wednesday.
Investors who buy a stock on or after its ex-dividend date
are not entitled to the dividend payment, and the companies
going ex-dividend had the technical impact of taking some 20
points off the FTSE 100 index.