After a strong start, markets across Europe dipped into the red by midday with the US fiscal cliff continuing to dominate market sentiment.
‘We are now just over three days away from the so-called ‘fiscal cliff’ and after many months of posturing and political bravado, the US has run out of time,’ said research analyst Joshua Mahony from Alpari.
‘Much like a Hollywood movie, this story has been set-up with a nail biting finish with both political parties having set up a respective summit to try to thrash out one last ditch effort to avoid what is a man made crisis. Each side has provided numerous statements regarding how unable their counterparts are to compromise and that they are the ones trying to avert the crisis,’ he said.
President Obama has called a meeting with congressional leaders today in which they are expected to draw up a piece of legislation to be submitted to the House of Representatives (HoR). The Republicans are scheduled to meet on Sunday, the first HoR Sunday session in more than two years.
Stock futures in the US were pointing to a weak start on Wall Street with investors awaiting the Chicago purchasing managers’ index and pending home sales figures later on.
Platinum miner Lonmin dropped after announcing that its CEO Ian Farmer has stepped down from the company due to a serious illness. ‘We wish him well with his ongoing treatment and will stay in close touch with him as a valued colleague and friend,’ said Chairman Roger Phillimore.
The wider mining sector was out of favour this morning as risk appetite was scaled back: Polymetal, ENRC and Vedanta were among the worst performers.
In contrast, defensive sectors such as supermarkets (Morrison, Tesco) and pharmaceuticals (Shire, GlaxoSmithKline) were in demand.
On AIM, oil explorer San Leon Energy gained after reporting that its Nowa Sol exploration programme in Poland has showed high potential for oil production.
Sector peer Ruspetro saw shares surge after Russian authorities granted the company a licence extension for its Palyanovsky Block.
US-focused hydrocarbon explorer Caza Oil & Gas jumped after saying that initial production has started at its Forehand Ranch Prospect in Eddy County, New Mexico.
Randall and Quilter edged higher after completing the acquisition of Alma Insurance Company after receiving regulatory approval from the Finnish Financial Services Authority.
FTSE 100 – Risers
Morrison (Wm) Supermarkets (MRW) 263.70p +0.96%
SABMiller (SAB) 2,865.50p +0.90%
Aberdeen Asset Management (ADN) 368.90p +0.88%
Tesco (TSCO) 337.75p +0.52%
Shire Plc (SHP) 1,905.00p +0.47%
GlaxoSmithKline (GSK) 1,353.00p +0.30%
AstraZeneca (AZN) 2,935.50p +0.29%
Royal Bank of Scotland Group (RBS) 325.90p +0.28%
Babcock International Group (BAB) 975.50p +0.26%
Reckitt Benckiser Group (RB.) 3,905.00p +0.26%
FTSE 100 – Fallers
Admiral Group (ADM) 1,170.00p -2.34%
International Consolidated Airlines Group SA (CDI) (IAG) 184.40p -1.91%
Resolution Ltd. (RSL) 247.80p -1.59%
BT Group (BT.A) 233.90p -1.56%
Polymetal International (POLY) 1,171.00p -1.51%
British Sky Broadcasting Group (BSY) 769.00p -1.47%
Eurasian Natural Resources Corp. (ENRC) 285.60p -1.31%
Capita (CPI) 759.00p -1.24%
Prudential (PRU) 866.50p -1.20%
G4S (GFS) 256.80p -1.15%
FTSE 250 – Risers
Renishaw (RSW) 2,026.00p +3.95%
Heritage Oil (HOIL) 192.00p +3.28%
Hansteen Holdings (HSTN) 80.95p +2.66%
Stobart Group Ltd. (STOB) 104.70p +2.65%
IP Group (IPO) 120.00p +2.56%
PayPoint (PAY) 840.00p +2.25%
Rank Group (RNK) 146.60p +1.95%
Soco International (SIA) 361.90p +1.94%
Bumi (BUMI) 273.70p +1.79%
Dignity (DTY) 1,075.00p +1.70%
FTSE 250 – Fallers
Cable & Wireless Communications (CWC) 35.30p -2.62%
FirstGroup (FGP) 205.30p -2.56%
Petropavlovsk (POG) 351.10p -2.23%
Phoenix Group Holdings (DI) (PHNX) 538.00p -2.18%
Balfour Beatty (BBY) 274.70p -2.00%
Lonmin (LMI) 279.90p -1.96%
ITE Group (ITE) 239.00p -1.89%
Ashtead Group (AHT) 423.80p -1.74%
Home Retail Group (HOME) 126.60p -1.71%
Afren (AFR) 130.00p -1.52%