LONDON MARKETS: FTSE Logs Worst Day Since June 2016

Date : 12/06/2018 @ 9:22PM
Source : Dow Jones News
Stock : FTSE 100 (UKX)
Quote : 6721.54  -56.57 (-0.83%) @ 4:35PM
FTSE 100 share price Chart

LONDON MARKETS: FTSE Logs Worst Day Since June 2016

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By Anneken Tappe, MarketWatch , Emily Horton

Mining, oil and banking stocks drop

U.K. stocks were once again under pressure Thursday, recording their worst one-day percentage decline since late June 2016. Global stocks sold off amid slumping oil prices and escalating worries over U.S.-China trade relations following the arrest of a high-profile Huawei executive.

Oil, mining and banking stocks were particularly under pressure.

What did markets do?

The U.K.'s FTSE 100 closed down 3.2% at 6,704.05 points, logging its worst one-day percentage drop in nearly 18 months, and its worst point decline since late August 2015.

It was the FTSE's 11th down day in the past 15 sessions, and a new 52-week low. The index is down 12.8% in the year-to-date.

The British pound firmed to $1.2780 from $1.2735 late Wednesday in New York.

What was driving the market?

The arrest of Meng Wanzhou (http://www.marketwatch.com/story/huawei-cfo-arrested-in-canada-at-us-request-for-allegedly-breaking-iran-sanctions-2018-12-05), chief financial officer of Chinese telecommunications company Huawei Technologies, in Canada by request of the U.S. reignited trade worries, leading U.S. stock futures to tumble on Thursday (http://www.marketwatch.com/story/dow-futures-off-300-points-as-arrest-of-huawei-exec-reignites-trade-worries-2018-12-06). Chinese authorities in turn demanded Wanzhou's release. Huawei said the company wasn't aware of any wrongdoing by her.

The latest developments have further driven investor doubts over the trade cease-fire agreement reached by the U.S. and China over the weekend at the G-20 summit.

Elsewhere, a two-day OPEC meeting kicked off, and oil prices sunk amid no signs of a deal to cut production (http://www.marketwatch.com/story/oil-prices-sink-as-saudi-official-signals-no-pact-yet-at-key-opec-gathering-2018-12-06) during the European trading day. After hours, OPEC agreed a preliminary pact to cut output.

Uncertainty over whether U.K. Prime Minister Theresa May will get her proposed Brexit agreement through parliament on Dec. 11 remains a worry as well.

See:Brexit briefing: London's mayor proposes that prime minister revoke Brexit notification (http://www.marketwatch.com/story/brexit-briefing-londons-mayor-proposes-that-prime-minister-revoke-brexit-notification-2018-12-06)

Read:Theresa May absorbed three sharp blows Tuesday as steward of U.K.'s Brexit process (http://www.marketwatch.com/story/what-mays-losses-in-parliament-and-the-european-courts-vote-mean-for-brexit-2018-12-04)

What stocks were active?

Heavyweight banking stocks were among the biggest losers on Thursday, with HSBC Holdings PLC (HSBA.LN) finishing down 3.6% and Lloyds Banking Group PLC (LLOY.LN) down 2.7%.

Oil stocks were under pressure as well, with BP PLC (BP.LN)(BP.LN) and Royal Dutch Shell PLC (RDSA.LN)(RDSA.LN) both closing down 4.5%.

Mining stocks skidded, with Rio Tinto PLC (RIO.LN)(RIO.LN) finishing 3.7% lower, and Glencore (GLEN.LN) closing 5.1% down. BHP Billiton Ltd. (BHP.LN)(BHP.AU) ended 4.4% lower.

 

(END) Dow Jones Newswires

December 06, 2018 16:07 ET (21:07 GMT)

Copyright (c) 2018 Dow Jones & Company, Inc.
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