London’s blue chip stocks remained lower at lunch as the lower commodity prices, particularly oil and copper, weighed on the FTSE 100.
The index dropped 20 points to 6,530 as the price of a barrel of US light crude slipped almost 1.5% to US$41.89. A barrel of Brent declined 0.3% to US$49.
Connor Campbell at spread-betting firm Spreadex said: “With Brent Crude attempting to break US$50 per barrel and copper struggling to escape its recent lows the commodity situation remains an energy-sapping annoyance for the FTSE.”
Heavyweights BP (LON:BP.) and Royal Dutch Shell (LON:RDSB) dragged the market lower, falling 2.5p to 376p and 6.5p to 1,807p respectively.
Away from the index, Ophir Energy (LON:OPHR) lost 6.8% to 101p while Premier Oil (LON:PMO) eased 4% to 103p.
In Europe, the continued calls from Germany for the IMF to get involved with the third bailout highlighted the difficult prospect Merkel has of trying convince her more sceptical MPs that a deal should be approved.
“Still the deal should pass, even if it does spell trouble for the German chancellor down the road; not that investors seem to care” Campbell said.
Given the market-moving power of Greece in the first half of 2015, investors clearly aren’t as fussed about the issue as they once were he added.
In Europe, the Dax was 16 points lower to 10,968 while the Paris-based Cac40 managed a 9 point gain to 4,965.
Back in the UK, Bovis Homes (LON:BVS) reported a record number of first-half home deals.
Bovis increased pre-tax profit by 9% to £53.8mln against a year earlier on a 9% rise in revenue to £350.7mln.
The company warned, however, that the rising cost of tradesmen and a shortage of skilled workers meant overall cost inflation was 7% this year. Shares dropped 4.9% to 1,142p.
Shipping broker Clarkson (LON:CKN) sank 161p to 2,589p as it posted higher profits and dividends but said results would be weighted to the second half.
In small caps, African Potash (LON:AFPO) up 32.8% to 1.5p was one of the biggest gainers at lunch although it has had no news out since last Wednesday.
Shares have been on the march since it signed a deal with Comesa – a free trade union of twenty African countries - to provide 500,000 tonnes of fertiliser over three years.
Meanwhile, Cellcast (Lon:CLTV) the operator of interactive TV broadcaster Babestation, denied speculation that it was in talks with Google.
Having traded as high as 1.92p in early deals, Cellcast shares have been volatile all day and were trading at 1.55p at lunch, up 40% for the day.
Conversely, Red Emperor Resources (LON:RMP) was the biggest faller as it failed to find commercial oil at its Hawkeye Well.
Having spent US$25mln (£15.9mln) on the project, the company has £5.66mln left to identify new opportunities. Shares plummeted 61% to 1.27p.