FTSE 100 watch: Footsie gives up gains as Fed meeting looms

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The UK benchmark index has slipped into the red in today’s session, giving up its morning gains, with investors staying on the sidelines ahead of the US Federal Reserve’s last policy meeting for the year scheduled to start tomorrow. Polymetal (LON:POLY) meanwhile has fallen to the bottom of the FTSE 100 leaderboard following a downgrade at RBC Capital Markets.

As of 12:29 GMT, the Footsie had lost 17.95 points to stand 0.26 percent lower at 6,936.26. The index has retreated ahead of tomorrow’s Fed meeting with the US central bank largely expected to hike interest rates. Earlier today, however, the FTSE 100 was trading in positive territory, finding support in higher oil prices after OPEC and non-OPEC producers agreed to curtail output.

“The OPEC deal made two weeks ago hinged on the non-OPEC members also agreeing to cut production – many members of OPEC had stated that they would only agree to cut production on the basis the non-members also agreed,” James Hughes, chief market analyst at GKFX, told Reuters, adding that the agreement “put the issue of a global oil glut to rest, but only for now”.

Despite the index’s retreat, energy shares remain in demand on the back of stronger oil, with Royal Dutch Shell (LON:RDSA) having added 2.75 percent to 2,145.00p, and shares in BP (LON:BP) changing hands 2.06 percent higher at 486.02p.

In individual movers, Polymetal’s share price has fallen 5.17 percent to 742.50p after analysts at RBC Capital Markets trimmed their rating on the stock from ‘outperform’ to ‘sector perform’ and slashed their price target from 1,460p to 810p. Sharecast quoted the broker as pointing to increasing gold price volatility, high levels of 2017 capex and a higher free cash flow break-even price than peers.

The FTSE 100 was 0.27 percent down at 6,935.18 points as of 12:39 GMT on Monday, 12 December 2016.

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