* FTSE 100 down 0.3 pct
* Strong technical support seen at 6,600
* Randgold, Fresnillo can weather lower metal prices-JPM
By Toni Vorobyova
LONDON, July 22 Britain's FTSE 100 edged further
off 7-week highs on Monday, with gains in miners outweighed by a
retreat in heavyweight GlaxoSmithKline as the bribery
scandal engulfing the drugmaker in China deepened.
Glaxo, the fifth biggest company in the FTSE 100, fell 1.2
percent after saying that some of its executives in China
appeared to have broken the law.
"Things seem to be getting more worrying ... We really now
have to see more of the facts before forming a definitive view.
If it does transpire that Chinese law has been broken we feel
that downside pressure for the (Glaxo) share price will remain
in place for the short to medium term," said Atif Latif, trader
at Guardian Stockbrokers.
The share price fall took 3.8 points off the blue-chip
index, which was down 16.54 points, or 0.3 percent at 6,614.13
points by 0736 GMT. The FTSE has been on the back foot
after stumbling against technical resistance around its late May
peaks near 6,657 points at the end of last week, though
technical charts still suggest scope for further gains.
"We look for a downside hold of 6,600 and then a base
forming for a move higher," Latif said.
Miners helped keep the benchmark above that key support
level, cheered by a recovery in gold to one-month highs. The
sector has shed a fifth of its value so far this
year in tandem with a similar slump in the bullion price.
Fresnillo and Randgold Resources led the
gainers, up 2.9 and 2.8 percent respectively, after JP Morgan
deemed them - along with mid-cap Polymetal - as the
best able to weather weaker metal prices.
"The equities have been routed as investors believe
producers have been complacent, with mine and capex plans
calibrated on much higher gold prices, meaning free cash flow
generation is overtly and in certain cases perilously negative
for the next two years," analysts at JP Morgan said in a note.
"Yet we believe investors underappreciate the potential for
self-help among the UK gold producers; leverage is low, growth
is imminent, and Randgold, Fresnillo, Polymetal and even African
Barrick have flexibility to reduce costs and protect
free cash flow."
(Reporting By Toni Vorobyova; Editing by Toby Chopra)