LONDON MARKETS: FTSE 100 Hovers Around Record High As Miners Advance

By Carla Mozee, MarketWatch Features Dow Jones Newswires

Pound gains modestly after three weekly drops in a row

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U.K. blue-chip stocks steadied around record highs Monday, with commodity stocks among those gaining ground.

What markets are doing: The FTSE 100 index was down less than 1 point at 7,560.27. Commodity, utility, tech and health care shares strengthened, but financial, consumer services and industrials shares lost ground. On Friday, the benchmark rose 0.1% to 7,560.35, the highest close on record (http://www.marketwatch.com/story/ftse-100-on-course-for-fresh-record-as-pound-stutters-2017-11-03). It also finished last week up by 0.7%. bouncing back after two weeks of declines.

In Monday's trade, the pound fetched $1.3110, up from $1.3075 late Friday in New York.

What's moving markets: Gains for metals prices buoyed mining shares, with iron ore futures climbing more than 2% overnight, according to BMO Capital Markets.

Meanwhile, oil benchmarks are holding around their highest in more than two years, with Brent trading above $62 a barrel, in part as investors assess the implications of weekend news that several Saudi Arabian officials and members of the royal family had been detained as part of an anti-corruption crackdown.

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Among those detained was Prince al-Waleed bin Talal, one of the world's richest men.

Investors also kept an eye on the pound, which was back above the $1.31 level. Sterling last week fell 0.4%, a third straight week of losses. Pound strength can weigh on multinational companies which are heavily weighted on the FTSE 100.

What strategists are saying: "The week kicked off with limited appetite for stocks on news that Saudi's billionaire Prince Alwaleed bin Talal, one of the world's biggest investors, has been arrested in an anti-corruption purge in Saudi Arabia," said Ipek Ozkardeskaya, senior market analyst at LCG, in a note.

"Investors will be watching what could happen to Alwaleed's holdings under his arrest and how these companies' stock prices will react to the news. For many of them, the impact should not extend beyond an eventual knee-jerk sell-off. His large allocations could take a more significant hit," she wrote.

"Crown Prince Mohammad Bin Salman's Saturday night purge represents a stunning political development in Saudi Arabia and a shot across the bow at the old establishment," said Helima Croft, global head of commodity strategy at RBC Capital Markets, in a note published Sunday.

"We expect no immediate changes in oil policy. MBS seems strongly committed to anchoring the OPEC agreement deep into 2018 and moving ahead with the Aramco sale," she said.

Stock movers: Iron ore heavyweights BHP Billiton PLC (BLT.LN) (BHP.AU) and Rio Tinto PLC (RIO) rose 1.8% and 1.4%, respectively.

Oil producer Royal Dutch Shell PLC (RDSB.LN) picked up 0.4% but rival BP PLC (BP.LN) (BP.LN) was fractionally lower.

Bank shares, however, fell, with Barclays PLC (BCS) down 1.3%.

GlaxoSmithKline PLC (GSK.LN) was down 0.3% following a ratings downgrade to hold from buy at Investec, which said it made the move following Glaxo's third-quarter results and its commentary for potential margin pressure in 2018. Investec also cut its estimate on Glaxo's 2018 earnings by 5% to 9%.

(END) Dow Jones Newswires

November 06, 2017 04:23 ET (09:23 GMT)