Overview: the FTSE 100 stood 0.95% below the opening level in the last hour, dragged down by mining and energy companies after China said its commodities imports declined in October.
The negative impact from the Chinese data was partly offset by an unexpected decline in US jobless claims, which fell 24,000 to 435,000 last week.
Scottish & Southern Energy (LON:SSE) led the FTSE 100 with a 4% advance. Defence and aerospace systems manufacturer BAE Systems (LON:BA) climbed 3%. National Grid (LON:NG) and oil and gas company Tullow Oil (LON:TLW) tacked on just over 1%. Interdealer broker ICAP (LON:IAP) added 1%.
Mining stocks were the heaviest fallers in the FTSE 100 today. Platinum producer Lonmin (LON:LMI) and copper miners Kazakhmys (LON:KAZ) and ENRC (LON:ENRC) lost about 4.5%.
US stocks were off to a negative start. The Dow Jones Industrial Average and the S&P 500 index declined 0.5%, while the technology heavy NASDAQ composite was down 0.4%.
Commodities
Crude oil futures were in decline today after China said that its oil imports hit 18 month lows in October sliding to 16.1 million metric tonnes, which translates into 3.8 million barrels per day.
China’s imports hit historic highs in September, when they reached 22.9 metric tonnes.
US light, sweet crude for December delivery declined to US$87.04/barrel, while January crude fell to US$87.52/barrel on the New York Mercantile Exchange (NYMEX).
December Brent Crude retreated to US$88.13/barrel on the ICE Exchange. January Brent last traded at US$88.31/barrel.
BP (LON:BP) lost 1.3%, while fellow supermajor Shell (LON:RDSB) declined marginally, as did Cairn Energy (LON:CNE).
BG Group (LON:BG) held steady, while Tullow Oil (LON:TLW) outperformed fellow blue chips, climbing 1.3%.
Amec (LON:AMEC) rose marginally, while fellow oil and gas engineering firm Petrofac (LON:PFC) was sitting just below the opening level.
Soco international (LON:SIA) and Heritage Oil (LON:HOIL) led the midcaps, advancing 5% and 3.5% respectively. JKX Oil & Gas (LON:JKX) tacked on 1.9%, while Salamander Energy (LON:SMDR) posted a small gain.
Dragon Oil (LON:DGO) moved in the opposite direction, shedding 1.4%. Melrose Resources (LON:MRS) posted a small loss.
Premier Oil (LON:PMO) was little moved.
East and Central Africa focused oil and gas explorer Dominion Petroleum (LON:DPL) was among the top risers in the sector, surging 17.5%. Africa and FSU operating oil and gas exploration and production company Victoria Oil & Gas (LON:VOG) followed with an 11% gain.
EU operating producer and explorer Europa Oil & Gas (LON:EOG) and US focused Nighthawk Energy (LON:HAWK) followed, rising 8.5% and 7% respectively.
Gold reaches $1,400
Gold didn’t take long to recapture the US$1,400/oz level it lost late in yesterday’s session.
Safe haven demand increased amid worries over Ireland’s debt problems, prompting investors to pour more money into gold.
President of the World Bank Robert Zoellick wrote an article for the Financial Times, arguing that the US dollar should be replaced with a basket of currencies to use as standard, also calling for gold to be a part of what he referred to as “a new co-operative monetary system”.
Gold and silver advanced to US$1,402/oz and US$27.72/oz respectively, while platinum fell to US$1,759/oz.
Major mining stocks were in decline today. Platinum producer Lonmin (LON:LMI) declined 4.5% and silver miner Fresnillo (LON:FRES) lost about 2.5%, as did Randgold Resources (LON:RRS), while fellow gold producer African Barrick Gold (LON:ABG) retreated 1.3%.
Midcaps followed. Aquarius Platinum (LON:AQP) and silver producer Hochschild Mining (LON:HOC) declined 2.3% and 3% respectively. Gold producer Petropavlovsk (LON:POG) declined marginally.
Turkey focused gold exploration and development company Ariana Resources (LON:AAU) was among the top performers in the sector with an 11% gain. Other notable risers among the small caps included Turkey and Saudi Arabia operating gold explorer KEFI Minerals (LON:KEFI) and Latin America operating gold and silver explorer Patagonia Gold (LON:PGD), which advanced 9% and 6.5% respectively.
Base metals fall
Copper and nickel declined to US$3.93/lb and US$10.99/lb, while zinc fell to US$1.122/lb.
Base metal miners were in the red. Kazakhmys (LON:KAZ) was at the bottom of the pile with a 4.6% loss. Eurasian Natural Resources (LON:ENRC) and Antofagasta (LON:ANTO) followed, shedding 4.5% and 4.2%.
Xstrata (LON:XTA) and Rio Tinto (LON:RIO) lost 3.5% and 3.1% respectively. Vedanta Resources (LON:VED) retreated 2.6%.
Anglo American (LON:AAL) declined marginally.
London’s only listed pure iron ore producer an FTSE 250 constituent Ferrexpo (LON:FXPO) moved with the sector, dropping 3.6%.
Herencia Resources (LON:HER), which is focused on the Paguanta zinc-lead-silver-gold project, led the small caps with a 11.5% gain. Explorer for zinc, lead, barite and fluorite deposits Maghreb Minerals (LON:MMS) followed with an 8% gain.
Banks, insurance, private equity
Banks were in decline today. Royal Bank of Scotland (LON:RBS) was at the bottom of the pile with a 3.3% decline. Barclays (LON:BARC) and Standard Chartered (LON:STAN) followed with losses of 2.2% and 1.4% respectively.
Lloyds (LON:LLOY) and HSBC (LON:HSBA) declined marginally.
Insurers followed. Admiral Group (LON:ADM) retreated 2.1%. Legal & General (LON:LGEN) and Standard Life (LON:SL) shed 1.8% and 1.4% respectively. Aviva (LON:AV) and RSA Insurance Group (LON:RSA) lost about 1%.
Prudential (LON:PRU) declined marginally.
Old Mutual (LON:OML) bucked the trend, posting a small gain.
Private equity group 3i (LON:III) held steady.
Small Cap News
Patagonia Gold (LON:PGD) said this morning that construction of its heap leach pad at Lomada de Leiva in Argentina is progressing ahead of schedule.
London Mining (LON:LOND) refuted speculation that its operations at the Marampa project in Sierra Leone were suspended. In a statement late yesterday it said that media speculation was inaccurate and operations continue uninterrupted at the iron mine development project.
Dominion Petroleum (LON:DPL) has completed a 1,236 square kilometre 3D seismic survey on the Alpha prospect and other prospects in deep-water Tanzania.
Research has shown that Silence Therapeutics’ (LON:SLN) lead RNA interference (RNAi) drug candidate Atu027 can prevent the formation of pulmonary metastasis in various animal models of cancer metastasis.
Europa Oil & Gas (LON:EOG) has reported more progress from the closely followed drilling of the Barchiz-1 exploration well in Romania, sending shares up 7%.
Urals Energy (LON:UEN) shot up 17% following news of the completion of the 35b sidetrack well by Sakhalin operating joint venture (JV) Petrosakh, which has current production rates of 1,611 barrels of oil per day (bopd).
Telit Communications (LON:TCM) has demonstrated much greater revenue velocity than the market and it has secured a larger percentage of design wins than its market share , according to Northland Capital analyst David Johnson.
Wessex Exploration (PLUS:WX) was buoyed by Tullow Oil’s (LON:TLW) assessment of the high-potential deep water Guyane Maritime license in French Guiana.
Minera IRL (LON:MIRL, TSX:IRL, BVL:MIRL) has landed a C$37.5 million cash boost, after it raised even more capital than it expected. The company has now closed its ‘best efforts’ equity placing.
Atlantic Coal’s (LON:ATC) new excavator at the Stockton mine in Pennsylvania has enabled it to increase the amount of raw coal mined in each quarter this year, and this is expected to continue into the fourth quarter, according to Fox-Davies analyst Peter Rose.
Large and Mid Cap News
Tullow Oil’s (LON:TLW) Jubilee oilfield development in Ghana stood out as a key highlight of a comprehensive interim management statement. The company said that production from Jubilee’s Phase 1 development is now expected to reach the top end of expectations, at 58,000 barrels of oil equivalent per day (boepd).
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