The UK’s main index was approaching a triple digit fall on Tuesday Morning as it was unable to maintain yesterday's gains at the outset.
The driver for yesterday’s growth in Europe appears to have been the re-election of Alexis Tsipras and his Syriza party in Greece, although this was always unlikely to carry over to Tuesday.
Connor Campbell at Spreadex, said: “Of course that doesn’t help investors this Tuesday, who will be left searching for a sense of direction in the no man’s land between last week’s Fed statement and the next big number, ostensibly Friday’s US GDP figure. “
The FTSE 100 dropped 99 points to 6,009 despite the US ending on a positive note.
The Dow Jones advanced 125 points to 16,510, while the S&P 500 climbed nine points to 1,967. The Nasdaq Composite, which had been in the red, finished a couple of points higher on the day at 4,829.
London’s stocks were held back by the miners, with big losses for the likes of Glencore (LON:GLEN) down 8.8% to 108p, Antofagasta (LON:ANTO), which shed 6.1% or 34p to 531p, and Anglo American (LON:AAL) more than 5.7% lower at 655p.
Investors feared that the China flash PMI, due out on Wednesday, may fall below expectations, further showing the slowdown of its economy.
The China slowdown has hit metals prices, as China is a major global commodities consumer, with the copper price particularly affected, dropping 1.5%.
Oil firms also struggled, as a barrel of brent crude lost 1.4% to US$48.22 while the West Texas Intermediate fell 2.2% to US$45.93.
BP (LON:BP.) gushed 2.2% to 326p while Shell (LON:RDSB) leaked 1.8% or 29p to 1,567p.
In corporate news, Harvester and Toby Carvery owner Mitchells & Butlers (LON:MAB) softened 12p to 339p as it warned that wet weather would dampen full-year profits as it appointed a new chief executive.
In the small cap space, Mexican metal miner Arian Silver Corporation (LON:AGQ) has taken a step towards securing up to US$10mln of extra funding. Shares rocketed 54% to 11p making it the day’s biggest gainer so far.
Meanwhile, Keywords Studios (LON:KWS) saw revenue in the first six months of 2015 rise 23% year-on-year on a pro forma basis, which strips out the contribution of companies acquired in the last 12 months, and 74% with the acquisitions. Shares jumped 4.7% to 190p.
Conversely, leather manufacturer Pittards (LON:PTD) dropped 19.3% to 104p as warned that current trading is below expectations in a "depressed" leather industry.
Market Preview
London stocks will be looking to consolidate yesterday's gains at the outset.
Spread betting quotes suggest the FTSE 100 will open little changed from last night's close of 6,109.
“Equity markets continue to trade cautiously in the wake of last week’s decision by the Federal Reserve to hold interest rates at current levels,” notes Michael Hewson, chief market analyst at spread betting firm CMC Markets..
“Both European and US markets regained a little bit of equilibrium after Friday’s sharp down moves prompted concerns that the US central bank had significant worries about events in China,” Hewson added.
US markets moved higher yesterday, despite weakness of biotechs. The Dow Jones advanced 125 points to 16,510, while the S&P 500 climbed nine points to 1,967. At one point, the Nasdaq Composite was in the red, but recovered to finish a couple of points higher on the day at 4,829.
Chinese stocks this morning were on the rise. In Hong Kong, the Hang Seng was 162 points heavier at 21,924 while in Shanghai the Composite index was 20 points higher at 3,178.
Closer to home, a relatively quiet day is in prospect in terms of results from the big guns.
Irn-Bru maker AG Barr (LON:BAG) and motorist services provider AA (LON:AA.) are among those set to update the market early doors, while dual-listed cruises operator Carnival (LON:CCL) will unveil its third quarter figures later in the day.