Markets: Knock-on effect of Chinese slowdown

Further signs that Chinese factory output is slowing threw miners into fresh losses yesterday and dragged Britain’s top share index down.

Disappointing economic releases from Britain and the eurozone also contributed to the FTSE 100’s 0.8 per cent fall to 5,845.65.

David Jones, chief market strategist at IG Index, said: “A slew of weaker economic data is the reason behind the slide – poor manufacturing numbers from China, France and Germany have served to highlight the fragility of recovery, and a larger-than-expected drop in UK retail sales has reminded investors just how tough business on the UK high street continues to be.”

The FTSE’s heavily weighted mining stocks were battered by the renewed fears over a global recession, with Fresnillo slipping 116p to 1,621p, Vedanta Resources dropping 65p to 1,287p and commodities trader Glencore losing 12.3p at 403.5p.

Glasgow-based engineer Weir Group, which supplies equipment to the mining and oil industries, was also among the fallers, down 3 per cent to 1,803p.

But the woes of the wider sector were dwarfed by Randgold Resources. The gold miner was the biggest faller in London’s top flight as details emerged of a coup in Mali, where it has two big facilities. Shares dived more than 13 per cent amid reports that the military has seized control in the West African country, sparking fears Randgold’s operations may be disrupted. The stock was off 830p at 5,765p.

Retailers had a difficult session after official figures showed a larger-than-expected decline in sales volumes in February.

Next, which earlier reported a 5 per cent rise in profits, saw shares slide 1p at 2,914p. Marks & Spencer dropped 2 per cent or 6.5p to 383p.

New York: Cyclical sectors led Wall Street lower last night, setting the S&P 500 up for its first negative week in six, after factory data showed a slowdown in both the eurozone and China.

The Dow Jones industrial average was down 78.48 points, or 0.60 per cent, to finish the day at 13,046.14 while the broader Standard & Poor’s 500 Index was down 10.10 points, or 0.72 per cent, to close at 1,392.79. The Nasdaq Composite Index was down 12.00 points, or 0.39 per cent, ending at 3,063.32.