Oil producers decline, but miners mixed as gold gains
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U.K. stocks fell Tuesday as energy producers and miners lost ground, while shares in supermarket chain J Sainsbury PLC gained after an upbeat sales update.
The FTSE 100 declined 0.2% to 7,360.65, setting it on track for the first loss of the week.
Trading volume is expected be lower than usual as the U.S. marks the Independence Day holiday. On Monday, the London index snapped a four-session losing streak (http://www.marketwatch.com/story/ftse-100-on-track-to-break-4-day-losing-streak-as-oil-rallies-2017-07-03) by settling up 0.9% as oil prices rallied.
See:July 4th: Which markets are closed? (http://www.marketwatch.com/story/july-4th-which-markets-are-closed-2017-06-30)
Energy slip: On Tuesday, however, shares of oil producer BP PLC (BP.LN) (BP.LN) shed 0.6%, while rival Royal Dutch Shell PLC (RDSB.LN) (RDSB.LN) lost 0.2%.
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Crude oil prices were trading slightly lower (http://www.marketwatch.com/story/oil-gains-aiming-for-eight-winning-sessions-in-a-row-2017-07-03) after settling higher for eight sessions in a row on Monday. A loss Tuesday would break the longest winning run for West Texas Intermediate crude in more than seven years.
"Energy [and] metals prices (especially copper and iron ore, and safe-haven gold) have turned back from their recent highs on account of a [dollar] bounce," said Accendo Markets analysts in a note.
The ICE Dollar Index was marginally higher at 96.241.
Miners mainly lower: In the mining group, shares of Anglo American PLC (AAL.LN) dropped 0.4%, Antofagasta PLC (ANTO.LN) gave up 0.3%, and Rio Tinto PLC (RIO) (RIO) (RIO) shed 0.9%.
Headed in the other direction, precious metals producers Fresnillo PLC (FRES.LN) and Randgold Resources Ltd. (RRS.LN) (RRS.LN) moved up 1.6% and 1.1%, respectively, as gold prices rose.
The gains for gold, a traditional safe haven trade, came as North Korea said it had successfully test-launched an intercontinental ballistic missile (http://www.marketwatch.com/story/north-korea-claims-successful-test-firing-of-an-icbm-2017-07-04), which dropped into seas near Japan. Gold added 0.5% to $1,225 an ounce. The yen also benefited from the geopolitical uncertainty, with the dollar buying Yen113.07, compared with Yen113.38 late Monday in New York.
Worldpay rally: Shares of payments processor Worldpay Group PLC (WPG.LN) surged 19% after the company confirmed it has been approached by Vantiv Inc. (VNTV) and JPMorgan Chase & Co. (JPM) about a possible takeover.
Worldpay said, "There can be no certainty either that an offer will be made."
The confirmation comes a day after Danish digital-payments company Nets AS (NETS.KO) also said it has been approached by potential buyers.
Supermarket sweep: J Sainsbury PLC (SBRY.LN)(SBRY.LN) rose 1% after the supermarket chain said first-quarter same-store sales grew 2.3% (http://www.marketwatch.com/story/sainsbury-sales-rise-cost-savings-on-track-2017-07-04) and that its cost saving plan remains on track. But Sainsbury shares were paring back from session highs.
Rival supermarket chain Tesco PLC (TSCO.LN) (TSCO.LN) was down 0.2%, and Wm. Morrison Supermarkets PLC (MRW.LN) (MRW.LN) was 0.2% higher.
(http://www.marketwatch.com/story/sainsbury-sales-rise-cost-savings-on-track-2017-07-04)Economic docket: A reading on U.K. construction for June showed growth in the sector slowed last month. The construction purchasing managers index fell to 54.8 in June, down from 56 in May.
The pound fetched $1.2935, unchanged compared to ahead of the data. Sterling bought $1.2941 late Monday in New York.
Mortgage rules: The Bank of England changed its mortgage recommendation to lenders, saying they should stress test whether borrowers could still afford their mortgages if rates go up by the three percentage points.
"This recommendation applies to all lenders which extend residential mortgage lending in excess of GBP100 million per annum," the BOE said.
(END) Dow Jones Newswires
July 04, 2017 05:27 ET (09:27 GMT)