The FTSE 100 was trading slightly lower on Friday morning, pulling back from yesterday's close of 6,586.08 - its highest closing level since August 13th - as investors await the Federal Reserve policy meeting next week and continue to digest developments in Syria. The heavyweight mining sector was providing the main drag.
Meantime, and closer to home, the BoE´s Chief economist - Spencer Dale - has reportedly said that forward guidance is not an attempt to add stimulus by pre-comitting to lower for longer rates policy, which would push inflation above target. As an aside, the pound's trade-weighted index rose to 82.7 earlier on Friday.
"The decline in both base and precious metals is putting pressure on the mining sector this morning, keeping the FTSE 100 resolutely below the 6600 level as investors take shelter in more defensive stocks," said Brenda Kelly, Senior Market Strategist at IG. "European indices and gold prices have seen additional losses, as market expectations of a Fed asset-purchase reduction announcement next week were ramped up."
Kelly said that falls this morning were also fuelled by rumours that former Treasury Secretary and well-known hawk Larry Summers will succeed Fed Chairman Ben Bernanke in January.
Syria meanwhile continues to be closely watched as the US and Russia continued their talks in Geneva over a plan to have Bashar al-Assad hand over chemical weapons to international control in exchange for avoiding US military action.
US Secretary of State John Kerry described his talks with Russian counterpart Sergei Lavrov as "constructive" as they began the second day of their discussions with United nations-Arab League envoy Lakhdar Brahimi.
TSE 100: Miners slump as metals weaken
Falling gold, silver and copper prices hit mining stocks this morning. Gold in particular was at a five-week low and looks set to record its worst weekly loss since June as speculation ramps up about the Fed meeting. Gloomy comments on the precious metal from Goldman Sachs also weighed on prices today, with the bank saying that gold will slip to $1,050 an ounce next year from the current $1,316 level (as of this morning).
Source: LiveCharts
Meantime, and closer to home, the BoE´s Chief economist - Spencer Dale - has reportedly said that forward guidance is not an attempt to add stimulus by pre-comitting to lower for longer rates policy, which would push inflation above target. As an aside, the pound's trade-weighted index rose to 82.7 earlier on Friday.
"The decline in both base and precious metals is putting pressure on the mining sector this morning, keeping the FTSE 100 resolutely below the 6600 level as investors take shelter in more defensive stocks," said Brenda Kelly, Senior Market Strategist at IG. "European indices and gold prices have seen additional losses, as market expectations of a Fed asset-purchase reduction announcement next week were ramped up."
Kelly said that falls this morning were also fuelled by rumours that former Treasury Secretary and well-known hawk Larry Summers will succeed Fed Chairman Ben Bernanke in January.
Syria meanwhile continues to be closely watched as the US and Russia continued their talks in Geneva over a plan to have Bashar al-Assad hand over chemical weapons to international control in exchange for avoiding US military action.
US Secretary of State John Kerry described his talks with Russian counterpart Sergei Lavrov as "constructive" as they began the second day of their discussions with United nations-Arab League envoy Lakhdar Brahimi.
TSE 100: Miners slump as metals weaken
Falling gold, silver and copper prices hit mining stocks this morning. Gold in particular was at a five-week low and looks set to record its worst weekly loss since June as speculation ramps up about the Fed meeting. Gloomy comments on the precious metal from Goldman Sachs also weighed on prices today, with the bank saying that gold will slip to $1,050 an ounce next year from the current $1,316 level (as of this morning).
Source: LiveCharts
