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London market dragged into the red after shares in mining giant Glencore tumble

Published 24/08/2016

The FTSE 100 Index was off 32.73 points to 6,835.78
The FTSE 100 Index was off 32.73 points to 6,835.78

The London market was dragged into the red after shares in mining giant Glencore took a tumble as it continues to grapple with an unwieldy debt pile.

The FTSE 100 Index was off 32.73 points to 6,835.78, after the London-listed miner dropped more than 3% despite narrowing its losses in the first half of the year after flogging a number of assets.

Shares in Glencore were down 5.8p to 184p after it said its net loss fell from 676 million US dollars (£511 million) to 369 million US dollars (£279 million) in the period.

Net debt also fell, but still stands at 23.6 billion US dollars (£17.8 billion).

A collapse in commodity prices last year saw Glencore scrap its dividend and embark on a new strategy that includes selling assets and cutting costs.

Precious metal stocks were also under fire after the price of gold slipped 0.8% to 1327.5 US dollars per ounce ahead of a speech from the US Federal Reserve chairwoman, Janet Yellen, later this week.

Gold miner Randgold Resources was the biggest faller on the market, dropping more than 5% or 405p to 7615p, while silver miner Fresnillo was down 4% or 74p to 1762p.

Across Europe, Germany's Dax was up 0.2% and the Cac 40 in France closed 0.3% higher.

On the currency markets, the pound was buoyed by a recent flurry of positive data from the UK economy.

Last week, retail sales came in at a higher-than-expected 1.4% in July, while Tuesday's CBI Industrial Trends Survey showed export orders for Britain's manufacturers reached a two-year high in August thanks to the plunge in the value of the pound following the Brexit vote.

Sterling was up 0.3% against the dollar to 1.324 US dollars and 0.7% higher against the euro at 1.175 euros.

The price of oil was 2.3% lower at 48.82 US dollars a barrel after an unexpected build up in US crude stockpiles fanned fears over a growing global supply glut.

In UK stocks, South African-focused firms were dealt a blow after the rand fell amid rumours South Africa's finance minister, Pravin Gordhan, could be arrested.

Shares in Mediclinic International were down 43p to 1025p, Mondi was off 25p to 1574p and Old Mutual dropped 8.1p to 196.4p.

Meanwhile, WPP saw shares hit an all-time high amid cheer over a hefty rise in pre-tax profits.

Shares were 33p higher at 1780p after the advertising giant booked a 15.8% rise in pre-tax profit to £690 million in the first half of the year.

However, the company was stung by a £122 million writedown linked to its investment in analytics firm comScore.

The company said the EU referendum vote had not hindered its growth strategy.

The biggest risers on the FTSE 100 Index were Travis Perkins up 66p to 1695p, Barratt Developments up 14.3p to 500.5p, Lloyds Banking Group up 1.7p to 59.27p, ITV up 5.3p to 201.8p.

The biggest fallers were Randgold Resources down 405p to 7615p, Fresnillo down 74p to 1762p, Mediclinic International down 43p to 1025p, Old Mutual down 8.1p to 196.4p.

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