* FTSE 100 down 0.5 pct, ending 7-day winning run
* GKN falls, traders cite GKN warning on currency movements
* FTSE currently in technically "overbought" territory
LONDON, Feb 25 Britain's top equity index fell
on Tuesday, threatening to end a seven-day winning run, with
engineering group GKN sliding after it warned about the
impact from adverse currency movements.
The blue-chip FTSE 100 index, which had climbed 0.4
percent on Monday, retreated by 0.5 percent, or 31.75 points, to
6,834.11 points in early session trading.
GKN fell 3.5 percent, with trading volumes in the stock
coming in at 54 percent of its average 90-day volume - above
those for the FTSE where volumes only stood at 10 percent of the
index's average 90-day amount.
Although GKN posted a rise in annual profits and forecast
continued growth this year, it unnerved some investors by
warning that adverse currency movements could be a headwind for
GKN shares have risen some 60 percent over the last year,
but the warning about currency movements - with major
international companies having to grapple with a slump in
emerging markets currencies - led some traders to sell the stock
to cash in on that rally.
"The warning about a possible hit from currency movements is
impacting the stock," said Central Markets trading analyst Joe
The FTSE, which rose 14.4 percent in 2013 to post its best
annual gain since 2009, has risen 1.2 percent since the start of
The index is some 2 percent below its record high of
6,950.60 points, reached in late December 1999. Hantec Markets
analyst Richard Perry expected the FTSE to soon hit a record
level of 7,000 points but added the market may first have to
consolidate for a period around its current levels.
The FTSE currently has a relative strength indicator (RSI)
reading on a nine-day basis of around 80. If a market has an RSI
above 70, it indicates it is technically "overbought" while
under 30 shows it is technically "oversold".
"There are a few exhaustion signals going on, and the RSI
looks overbought. It doesn't mean we won't get to that all-time
high, but we might just need a bit of consolidation first," said