FTSE 100 lags behind international peers as mining stocks weigh

Hampered by a strong pound and falling metal prices, London’s top index was unable to mirror the jumps of its European and US counterparts on Tuesday.

After a rollercoaster day which saw it rising by nearly 1% in the morning before turning into negative territory for part of the afternoon, the FTSE 100 finally settled the day at 6,730.34 points, up 11.21, or 0.2%.

Kingfisher, which is expanding into the Middle East, Avast and M&G led the move higher, while downward pressure was provided by some of the index’s banks and miners as copper and iron prices fell.

It was a positive performance for London’s biggest companies, but weaker than Monday’s 1.3% jump and the rise also put it behind some of its closest international rivals.

Around the time markets closed in Europe, New York’s Dow Jones was up 0.9%, while its next-door neighbour the S&P 500 was even further ahead, up 1.9%.

In Europe, Paris’s Cac index rose 0.4%, while the Dax in Frankfurt ended the day up 0.6%.

“European stock markets are extending yesterday’s stellar rally but the gains registered today are far more modest,” said CMC Markets analyst David Madden.

“The positive mood is being fuelled by the hopes the US government will implement the 1.9 trillion dollar relief package soon.

“Hopes connected to the economic recovery story have lifted sentiment too. The FTSE 100 hasn’t rallied as much as its eurozone equivalents.”

This was in part due to sterling, which rose 0.5% to buy 1.3896 dollars. Against the euro, the pound was up 0.2% to 1.1688.

The price of Brent crude oil dropped by 0.6% to 67.83 dollars per barrel.

In company news, an announcement that recent trading had been ahead of expectations at WH Smith helped send the firm’s shares up 1.7%.

Aviation services specialist John Menzies revealed it had swung to a £121 million pre-tax loss, but analysts said the results had been resilient in a tough year. Shares closed up 2.1%.

DFS shares rose sharply, up 4.4% after it forecast another release of pent-up demand after lockdown lifts, to mirror a similar event last year.

Domino’s Pizza rose by 8.6% after revealing a record rise in sales during lockdown and revealed it will increase its drive-thru locations.

And finally, ITV rose by 4.2% despite a drop in profits by more than a third. The business said it was eyeing a turnaround.

The biggest risers on the FTSE 100 were Avast, up 24.6p to 444.6p, Scottish Mortgage Investment Trust, up 61p to 1117p, M&G, up 9.7p to 214.8p, Kingfisher, up 11.8p to 286.1p, and Entain, up 56p to 1473p.

The biggest fallers on the FTSE 100 were Standard Life Aberdeen, down 22.9p to 296.1p, Anglo American, down 133p to 2885.5p, Rio Tinto, down 221p to 5819p, Evraz, down 16.2p to 583.6p, and Glencore, down 7.25p to 284.9p.