Mining stocks led the FTSE 100 index into the red today amid mounting expectations that the United States will launch much-feared plans to scale back or “taper” its economy-boosting drive next week.
Falling metal prices hit the heavily-weighted commodity sector and investors chose to stay on the sidelines ahead of Wednesday’s US Federal Reserve decision on the future of stimulus measures.
The Footsie dipped 5.18 points to close at 6,583.8, knocking the blue-chip index off its one-month highs.
Chris White, head of UK equities at Premier Asset Management, said: “There’s a lot of noise around about the Fed, but if they’re considering tapering, then it should give you confidence that they think the economy is strong enough to withstand that.”
Miners dominated the FTSE 100 fallers’ board due to concerns that US tapering will deal a blow to global economic prospects and therefore demand for commodities.
Anglo American led the declines, off 52p to 1,568.5p, while BHP Billiton dropped 38p to 1,885p.
Nurofen and Strepsils owner Reckitt Benckiser posted the biggest gain in the top flight, up 102p to 4,554p, a rise of more than 2 per cent, as defensive stocks found favour.
Other risers included ITV as the broadcaster continues to test record highs on the back of improved advertising conditions and production successes. ITV rose 2 per cent or 3.8p to 183.4p.
Builders surged as traders brushed off calls from the Royal Institution of Chartered Surveyors for a 5 per cent cap on annual house price growth amid fears the south of England is heading for a “bubble”.
FTSE 100-listed Persimmon added 12p to 1162p, while in the second tier, Barratt Developments was 15.9p stronger at 330.9p and Crest Nicholson lifted 12.2p to 337.2p ahead of results next week.