FTSE 100 flat as sagging miners eclipse gains in real estate, set for monthly fall

By Siddarth S

(Reuters) – The exporter-heavy FTSE 100 index was muted on Thursday as weak China data-led decline in miners offset the gains in real estate stocks.

The blue-chip FTSE 100 index was flat by 0840 GMT and was set for monthly declines, while the mid-caps were up 0.5%.

The benchmark index was down more than 3% this month, though up 0.4% in the year.

“It is much more the sectoral composition that has helped the FTSE 100 performance and sterling at the margin rather than a view that UK economic prospects are better,” said Michael Metcalfe, head of macro strategy at State Street Global Markets.

Real estate stocks and real estate investment trusts rose over 1% each as yields slipped.

Industrial metal miners were down 0.7%, tracking lower prices after data showed China’s manufacturing activity contracted for the fifth straight month in August.

“The China story is not a cleaned theme to the extent that the slower the data gets the more expectations build for a policy response,” Metcalfe added.

Precious metal miners fell 1.6% leading sectoral declines.

Weighing further on the miners was Glencore that dropped 4.5% after a media report said dozens of asset managers accused it of lying in past share prospectuses to cover up corrupt activities. Its shares were also trading ex-dividend.

Homebuilders climbed 0.3%, extending gains for the third straight day.

Frasers shares rose 0.6% after the British sportswear group raised its stake in online fashion seller Boohoo, a regulatory filing showed.

British cyber-security company Darktrace added more than 2% after Jefferies raised its price target.

The U.S. Food and Drug Administration issued warning letters to three infant formula makers, including Reckitt Benckiser Group’s Mead Johnson Nutrition to correct their manufacturing processes to better catch bacterial contamination.

Shares of Reckitt were down 1.2%

(Reporting by Siddarth S in Bengaluru; Editing by Nivedita Bhattacharjee and Dhanya Ann Thoppil)