FTSE 100 hits one-month low, precious miners biggest drag

By Sruthi Shankar and Khushi Singh

(Reuters) -London’s blue-chip FTSE 100 index closed lower on Tuesday, hitting a one-month low, weighed down by a sell-off in precious metal mining shares, while hawkish remarks from central bankers outweighed support from better-than-expected UK wages data.

The FTSE 100 dropped 0.5%, while the domestically focussed FTSE 250 index was flat.

Precious metal miners led sectoral declines with a 2.6% fall, as gold prices dipped on a stronger dollar and rise in U.S. Treasury yields amid uncertainty around early interest rate cuts. [GOL/]

Global investors have scaled back expectations of aggressive monetary policy easing following better-than-expected economic data, particularly out of the United States.

“The rate cut conundrum continues to leave investors scratching their heads, wondering when central banks are going to stop backpedalling after giving hints about cuts,” said Danni Hewson, head of financial analysis at AJ Bell.

European Central Bank officials also warned on Monday it was too early to discuss rate cuts.

That countered optimism from data that showed British wages grew at the slowest pace in almost a year, adding to signs of a gradual cooling of inflationary pressure in the labour market.

Among individual stocks, shares in Superdry tumbled 11.6%, hitting a record low, on a report that the fashion retailer has hired PwC to examine further debt-raising options.

Experian gained 2.4% after the credit data firm posted a 9% rise in its third-quarter revenue, powered by strong demand for its new products and business wins.

UK’s largest property portal Rightmove Plc dropped 3.9% after JP Morgan downgraded the stock to “underweight”.

AstraZeneca shares lost 1.9%, after UBS initiated coverage on the drugmaker stock with “sell”, flagging concerns about its exposure to U.S. Medicare Part D reform that may result in price pressures and sales growth decrease.

The broader pharma and biotech index was down 1.2%.

Supporting the mid-cap index, Qinetiq gained 4.5% after the defence group launched a 100 million-pound ($126.54 million) share buyback programme.

($1 = 0.7903 pound)

(Reporting by Sruthi Shankar, Khushi Singh in Bengaluru; Editing by Varun H K, Sherry Jacob-Phillips and Jonathan Oatis)