A promising start for the UK’s blue-chip index failed to last as it was hit by quarterly option expiries.
Rather than rolling over what are essentially huge bets on the direction of the FTSE 100, traders decided to take profits given the rather uncertain macro-economic outlook.
The Footsie closed 2.02 points lower at 5,852.62, which marked it out as Europe’s laggard.
Its continental counterparts enjoyed a pretty good day amid speculation EU officials are working on an economic reform package for Spain.
Foreign imports Evraz (LON:EVR) and Vedanta (LON:VED) dominated the blue-chip risers’ list, posting gains of 4.3 and 3 per cent respectively, as they were swept along by higher precious metal prices.
Xstrata (LON:XTA) and Glencore (LON:GLEN), down 4.2 and 1.7 per cent respectively, succumbed a bout of post nuptial jitters, while also mirroring the wider concerns about the miners.
It was a different story for the small-cap FTSE AIM 100, which gained 41.87 points to 3,277.93.
The undoubted star was Nighthawk Energy (LON:HAWK), which leapt over 40 per cent after the US-focused exploration group revealed the first well of a four-well drill programme tested commercial oil from the Cherokee shale formation.
The John Craig 6-2 well on the company’s Jolly Ranch project in Colorado produced more than 600 barrels of oil in a continuous 24-hour flow test.
Analyst Andrew Matharu at Westhouse called it “a very good start” to Nighthawk’s four-well programme.
Matharu believes that now the company needs to show some consistent delivery on the wells, which he adds is probably what has held the Jolly Ranch assetback in the past.
“What’s happened here is an awful lot of work has been done and it’s paying dividends,” the analyst said.
“Of course the flow rates start off very high and then they drop off, but if they can keep on building on this, I could see myself enhancing my target price at some point in the future.”
Elsewhere, DiamondCorp (LON:DCP) sparkled as it rose 21 per cent after the group struck a financing deal that will meet more than three-quarters of the costs of its Lace mine in South Africa.
The Industrial Development Corporation has agreed to lend DCP U$26.7 million, which will be used to develop a 1.2 million tonne a year block cave mining operation at the company’s 74 per cent owned Lace mine.
Dog of the day was powered lifts specialist Tanfield Group (LON:TAN), which crashed by over 40 per cent afeer associate Smith Electrics pulled its proposed US listing.
Tanfield owns 24 per cent of the US-based electric vehicles maker and had raised £2.2 million in July to give Smiths short-term funds ahead of its proposed float. Smith arranged US$12 million of bridge financing to tide it over until the new IPO funds came through.
However, yesterday Smith said it had decided to pull the float due to lack of interest from shareholders at the price indicated of between US$16-18 per share.