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FTSE hits three-week low as investors dump banks, mining stocks

FTSE hits three-week low as investors dump banks, mining stocks
FTSE hits three-week low as investors dump banks, mining stocks Copyright Suzanne Plunkett(Reuters)
Copyright Suzanne Plunkett(Reuters)
By Euronews with REUTERS BUSINESS (EN)
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FTSE hits three-week low as investors dump banks, mining stocks


UK shares fell to three-week lows as investors dumped financial and mining stocks amid renewed fears about Brexit and Rome's budget showdown with Brussels and a sell-off across Asia and Wall Street in tech stocks knocked confidence.

The FTSE 100 <.FTSE> was down 0.5 percent at 1030 GMT, on track for its third straight daily loss, with sentiment also knocked by heavy losses in the euro zone after a report Apple has cut production triggered a global rout in tech stocks.

While the political chaos of last week has largely calmed, investors worried anew about UK Prime Minister Theresa May's struggle to get her draft Brexit deal passed in Brussels and at home, with banks bearing the brunt of the selling.

News from mid-cap lender CYBG that the Clydesdale and Yorkshire Bank owner has started taking contingency measures to handle uncertainties from the country's exit from the European Union reinforced those concerns.

"Brexit uncertainty is the short answer," said David Madden, market analyst at CMC Markets UK. "It's a case of get the cash out."

Banks <.FTNMX8350> and insurers <.FTNMX8570>, each down 1.8 percent, notched up the biggest declines, with mining companies dropping 1.6 percent as fresh concern about mounting tensions between China and the United States weighed on metals prices.

Among the few corporate earnings as the results season draws to a close, Compass Group and Halma were in demand, rising 3.1 percent and 3.8 percent respectively, as investors cheered cost-cutting efforts.

"With labour inflation the key concern across the sector currently, we think that investors may breathe a sigh of relief with 'in line' results and positive commentary on the top line and margin outlook," said Barclays analysts of Compass.

Electrical engineering company Spectris on the FTSE 250 jumped 10 percent after its numbers.

Elsewhere, dealmaking was in the news, with BTG soaring a third and hitting its highest in more than three years after U.S. medical device maker Boston Scientific agreed to pay 3.3 billion pounds ($4.25 billion) in cash to buy the company.

The purchase price was a 36.6 percent premium over BTG's closing stock on Monday.

Among the losers, small cap KCOM lost more than a third of its market cap and hit its lowest level in nearly eight years after the IT and communications company issued a profit warning.

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