* FTSE 100 index falls 0.3 percent
* Near-term technical outlook bearish
* Investors cautious ahead of Crimea referendum
By Atul Prakash
LONDON, March 14 Britain's top share index hit a
five-week low on Friday and headed for its biggest weekly drop
in eight months, with growth-driven stocks losing ground on
tensions before a referendum in Ukraine's Crimea region.
The blue-chip FTSE 100 index was down 0.3 percent at
6,537.36 points by 1130 GMT, taking the week's total losses to
2.6 percent, the biggest decline since June last year. The index
has fallen 5 percent since a high in late February.
The fund management, retail and mining sectors, all highly
sensitive to economic conditions, came under pressure as
investors looked to cut exposure to riskier assets heading into
the weekend, when Ukrainians in Crimea vote on whether to join
Russia. Moscow said it would veto a U.S.-drafted UN resolution
to declare the referendum illegal.
"The market is spooked due to the prospect of more sanctions
against Russia as an awful lot of money comes to the market from
some very rich Russian investors. The FTSE was touching new
highs anyway and Sunday's referendum has become a perfect excuse
to take some money off the table," David Battersby, investment
manager at Redmayne-Bentley, said.
"Until the Ukraine crisis is sorted out, which could drag on
for a while, the market does have the potential to move down
even further. But I am not talking about a massive leg
downwards. In the worst case scenario, the FTSE 100 could fall
up to 6,400, at which point it will become relatively cheaper."
The UK mining index fell 0.7 percent to become
the top sectoral decliner, led lower by a 1.2 percent drop in
global miner Rio Tinto.
The UK's second-largest independent asset manager Aberdeen
Asset Management fell 2.5 percent, the top decliner on
the FTSE 100 index, while building supplies group CRH
was down 2.2 percent.
After falling below its 50-day and 100-day moving averages
this week, the FTSE 100 fell below its 200-day moving average
and a 61.8 percent Fibonacci retracement of a rally from Feb. 4
to 24 on Thursday, pointing to a bearish trend.
"We've broken through 50-day and 200-day moving averages by
a chunk and that's no real surprise," Alastair McCaig, analyst
at IG, said.
"Every noise I've heard suggests that Crimea will vote to
join Russia ... and while the market is expecting that, it's the
consequences of it that make it more problematic."