By Sara Sjolin, MarketWatch
LONDON (MarketWatch) -- The U.K.'s benchmark index drifted lower
on Wednesday, as mining firms dropped after disappointing trade
data from China.
The FTSE 100 index lost 0.3% to 6,483.14, after closing at the
highest level since June 4 on Tuesday.
Mining firms posted some of the biggest losses in the index
after the release of disappointing trade data from China. Exports
unexpectedly fell 3.1% in June from a year earlier, marking the
first year-over-year drop for exports since January 2012. Imports
decreased 0.7%, below a Reuters estimate of an 8% rise.
Miners tend to be sensitive to growth indications from China, as
the country is a major user of natural resources. Metals prices
were, however, mostly higher.
Shares of Rio Tinto PLC (RIO) lost 1%, Anglo American PLC fell
1.3% and BHP Billiton PLC (BHP) dropped 0.9%. Glencore Xstrata PLC
shaved off 2.1% after UBS removed the commodity titan from its
Europe key call list.
Banks were also lower, even as Moody's Investors Service lifted
the outlook on the U.K. banking sector to stable from negative to
reflect the "increasingly stable economic outlook despite its low
growth prospects."
"Although the U.K. continues to face the prospect of low
medium-term economic growth, Moody's does not expect a
deterioration in the operating environment. Moreover, unemployment
has not increased as much as in previous recessions, thereby
contributing to a stabilization in banks' asset quality," the
ratings agency said.
Shares of Royal Bank of Scotland Group PLC (RBS) fell 1.3%, HSBC
Holdings PLC (HBC) dropped 0.5% and Lloyds Banking Group PLC (LYG)
slipped 0.3%.
On a more upbeat note in London, oil firms showed positive
trends as oil prices moved above $105 a barrel for the first time
since May 2012. BG Group PLC rose 0.6%, BP PLC (BP) added 0.9% and
Royal Dutch Shell PLC (RDSB) inched 0.4% higher.
Burberry Group PLC shares (BURBY) also bucked the negative trend
in London, rising 4.4% after the company's fiscal first-quarter
trading update. The luxury-goods firm said same-store sales rose
13%, driven by "exceptional" performance of its spring/summer 2013
fashion line.
Shares of Tesco PLC (TSCDY) gained 1.1% after Exane BNP Paribas
lifted the supermarket retailer to outperform from neutral.
Exane also lifted Wm. Morrison Supermarkets PLC to neutral from
underperform, helping send the shares 1.2% higher.
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