THURSDAY MARKET CLOSE: Russia weighs on London

The prospect of Russia retaliating to the latest round of sanctions from Western governments took its toll in the City, which also fretted over signs of cooling growth in China.

New EU sanctions came as fighting in eastern Ukraine continued. Picture: Getty
New EU sanctions came as fighting in eastern Ukraine continued. Picture: Getty

Mining stocks were among the hardest hit, with copper specialist Kazakhmys dropping 13.9p, or 4.6 per cent, to 287.8p following a downgrade by analysts at Westhouse Securities, and precious metals miner Fresnillo down 23p at 819p.

Alastair McCaig, market analyst at IG, said: “The EU has outlined a new wave of sanctions on Russia that will come into effect on Friday, and traders are already pricing in some sort of retaliation from Moscow.

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The FTSE 100 index ended the day down 30.49 points at 6,799.62, with London Stock Exchange itself heading the list of fallers. Shares slid 182p, or 8.9 per cent, to 1,867p following its discounted rights issue to help fund the purchase of US asset manager Frank Russell.

With a growing list of Scottish-based firm outlining their plans ahead of next week’s independence referendum, Standard Life added 6p to end the session at 413.4p, while Royal Bank of Scotland gained 3.8p to 346p.

CMC Markets analyst Jasper Lawler said: “Some large multinationals are upping the anti-separation rhetoric by outlining contingency plans for a headquarters move should the Yes camp win. Should the vote be evenly split there is speculation that some companies may move to England or Wales anyway to avoid risk from any future re-vote.”

Argos-owner Home Retail Group fell 7.3 per cent, or 13.6p, to 174p after the catalogue chain disappointed analysts with like-for-like sales growth of 1.2 per cent for the 13 weeks to August 30, falling well short of the 3.4 per cent that had been expected.

The update also dashed City hopes that Homebase is about to be sold to US buyout funds after chief executive John Walden said there was no sale process under way.