WEDNESDAY MARKET CLOSE: FTSE down 2% as copper prices slide

London’s heavy exposure to commodity stocks ensured the FTSE 100 took a beating after a global growth downgrade by the World Bank led to fears that there is an oversupply of certain metals.

The index slumped by more than 2 per cent, down 153.74 points at 6,388.46, with miners leading the losses, in some cases with falls of almost 10 per cent.

Tony Cross, market analyst at Trustnet Direct, said: “Oil prices have been very much in focus of late and there’s a growing consensus that $40 a barrel will be the floor, but in the last 24 hours we’ve seen pressure heaped onto metals prices. Copper has been the most notable, slumping by as much as 8 per cent at one point and hammering the likes of Antofagasta.”

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The negativity spilled over to other commodities too, with miner and trader Glencore taking the biggest hit among the top tier stocks. It was down more than 9 per cent or 24.95p at 244p. Anglo American wasn’t far behind, down 103p at 1,042.5p, while Antofagasta slipped 34p at 675p and BHP Billiton dropped 72p to 1,285p.

With the World Bank’s report published late on Tuesday pointing out that the global recovery was too reliant on the US and that a rate rise from the Fed could have a knock-on effect in emerging markets, Asia-focused bank Standard Chartered was also under pressure. It was down almost 5 per cent at 886.1p. HSBC was 14.1p lower at 590.1p.

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Tesco topped a meagre risers’ board, up 2p at 214p, as broker Shore Capital issued a relatively upbeat take on the sector and pointed out that Tesco had effectively beaten its big four competitors over Christmas.

Britain’s biggest retailer was also helped by news that billionaire hedge fund manager Bill Ackman had been mulling taking a stake in the firm.