London's investors ask: Dude, where's my rally?June 21 2013, 5:51pm
London was just about keeping its head above water, clawing back some of its recent heavy losses, until Wall Street turned lower.
That prompted a late swoon by the FTSE 100 index, which closed at 6,116, down 43 on the day, down 192 on the week and an eye-watering 624 on the month.
Markets have been knocked for six by remarks from Fed chairman Ben Bernanke about a possible tapering of the US bond buying programme sent global markets into a tailspin.
The market knew that the Fed would one day have to go down this route, but seems to have been caught on the hop by Bernanke’s apparent enthusiasm for taking away the punch bowl at the earliest opportunity.
Fallers outnumbered risers by three to one among the blue-chip index’s constituents, and while the likes of Bunzl (LON:BNZL), Antofagasta (LON:ANTO) and TUI travel (LON:TT.) held on to decent gains, the bottom end of the Footsie leader board contained some real horror stories: Royal Bank of Scotland (LON:RBS), down 7.24%; Fresnillo (LON:FRES), down 5.1%, and even stock market darling, Burberry was disrobed, down 3.52%.
The latter, the smallest of Britain’s ‘big four’ telecoms, tumbled 6%, as Citi suggested BT’s (LON:BT.A) new free Premier League offering could tempt its broadband customers away.
Citi believes selling TalkTalk shares and buying BT is the way forward for investors. BT shares hardened 1% on the write-up.
Amur Minerals (LON:AMC) shares rose 2.1% as its Kun Manie nickel deposit in Russia grabbed the attention of the investor world. SP Angel’s John Meyer picked up on the share price rise and put it down to “new trade and expectations for a positive field season”.
Vatukoula Gold Mines (LON:VGM) relinquished earlier gains, however, as it completed a £4.5mln share subscription.
In contrast, the market reacted well to Fastjet’s (LON:FJET) draw-down of equity, sending the shares 3.1% higher.
Fortunes seem to be turning around for Africa’s low-cost airline, with the group securing its long-held ambition last week of securing international routes.
Medusa Mining (LON:MML, ASX:MML) lost 5.5% as some light was shed on its recent share price fall. The company revealed that the company in charge of upgrading the mill at its Co-O gold mine in the Philippines has gone into administration.