LONDON (Reuters) - Britain’s top share index ended lower on Tuesday after dipping to a three-week low, with commodities-related stocks coming under pressure from falls in oil and metals prices.
The blue-chip FTSE 100 index .FTSE ended 1.2 percent weaker at 6,091.23 points after hitting an intra-day trough of 6,061.85, the lowest since early March.
“A three-week low in the price of oil goes some way to explaining deteriorating market sentiment,” said Jasper Lawler, analyst at CMC Markets. “Some heavy declines in industrial metal prices over the past three days are taking a toll on the UK-listed mining companies.”
Oil prices fell after a surprise drop in U.S. gasoline demand and on doubts whether oil producers can agree an output freeze to dampen a global supply glut, while copper hit a one-month low on uncertainty over the economic recovery in China, the world’s top raw materials consumer. [O/R][MET/L]
Shares in Glencore GLEN.L, BHP Billiton BLT.L, Anglo American AAL.L and Rio Tinto RIO.L fell between 2.4 and 4.6 percent. Among oil majors, Royal Dutch Shell RDSa.L and BP BP.L fell 2.0 percent and 2.1 percent respectively.
“We’re now currently within the third week of downside for oil prices and that follows on from five consecutive weeks of gains in U.S. crude oil, so I feel like we’ve seen quite a substantial rally - we’re taking back some of that. We’re also seeing people positioning as precursor to the OPEC meeting,” said Joshua Mahony, market analyst at IG.
The world’s largest oil producers are due to meet in Doha on April 17 to negotiate an output freeze.
In other sectors, shares in grocer Tesco TSCO.L fell 1.7 percent after Deutsche Bank cut its rating on the stock to "hold" from "buy", citing the strength of the share price in recent months.
Macroeconomic data also did not help the market. A closely watched survey suggested that Britain’s economy had slowed since the start of this year as worries about the global economy, government spending cuts and a vote on staying in the European Union took their toll.
Editing by Kevin Liffey
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