London midday: Stocks see follow-through selling from Asian session

The UK's top-flight index had slipped into the red come midday as weakness overnight in Japanese equities filtred through into the European session, with weakness in US high-yield debt markets, the energy sector in particular, seen as the epicentre of current worries.

That followed a sharp widening in credit default swaps - financial derivatives used by investors to protect against default risks - for many European lenders registered a sharp rise.

As of 1218GMT, the FTSE 100 was down by 0.62% or 44.43 points to 5,644.93, showing some resilience nevertheless compared with the heavy falls seen in the US and in Asia, where the Nikkei 225 closed down over 5%.

Similarly, oil prices were higher despite a warning from the International Energy Agency that the global glut in oil will be greater than forecast in the first half of 2016.

West Texas Intermediate crude futures were up by 0.64% at $29.89 a barrel and Brent crude futures up by 0.30% at $32.98.

“However, while the banks remain under pressure the next panic sell off could just be around the corner. Janet Yellen’s testimony this week will be under even more scrutiny than usual and those without the stomach for some extreme volatility may well be advised to take a back seat,” said Mike McCudden, head of derivatives at Interactive Investor.

In corporate news, TUI AG was under the cosh after the tour operator reaffirmed its 2016 earnings guidance but reported a wider net loss for the first quarter.

Housebuilder Redrow nudged higher after posting a rise in first half pre-tax profit as revenue and completions grew.

Legal & General rallied after the insurer and investment manager updated the market with details of its annuity bond portfolio.

Supermarket retailer J Sainsbury was a high riser after market research firm Kantar said it was continuing to outperform the industry.

In terms of sectors, miners were the standout losers, with Antofagasta, Anglo American, Rio Tinto and BHP Billiton firmly in the red.

Broker notes weighed on the sector as Goldman Sachs downgraded Antofagasta to ‘sell’ from ‘neutral’.

Market Movers

FTSE 100 (UKX) 5,669.71 -0.35%
FTSE 250 (MCX) 15,331.91 -1.07%
techMARK (TASX) 2,924.60 0.15%

FTSE 100 - Risers

Legal & General Group (LGEN) 208.00p 2.46%
Tesco (TSCO) 176.80p 2.43%
Next (NXT) 6,575.00p 2.26%
WPP (WPP) 1,367.00p 2.17%
BT Group (BT.A) 464.20p 2.07%
Vodafone Group (VOD) 203.30p 1.55%
Kingfisher (KGF) 319.30p 1.46%
ARM Holdings (ARM) 933.00p 1.41%
Unilever (ULVR) 2,975.00p 1.21%
Whitbread (WTB) 3,694.00p 1.12%

FTSE 100 - Fallers

Anglo American (AAL) 339.95p -9.61%
Antofagasta (ANTO) 411.00p -9.35%
Rio Tinto (RIO) 1,720.50p -6.52%
BHP Billiton (BLT) 670.80p -5.19%
Glencore (GLEN) 97.85p -4.82%
Worldpay Group (WI) (WPG) 265.50p -3.66%
London Stock Exchange Group (LSE) 2,121.00p -3.46%
Standard Chartered (STAN) 415.00p -2.81%
Barclays (BARC) 159.70p -2.56%
TUI AG Reg Shs (DI) (TUI) 1,074.00p -2.19%

FTSE 250 - Risers

IG Group Holdings (IGG) 715.50p 2.36%
Acacia Mining (ACA) 234.80p 2.35%
Aveva Group (AVV) 1,259.00p 1.78%
QinetiQ Group (QQ.) 215.50p 1.65%
Diploma (DPLM) 641.50p 1.58%
BBA Aviation (BBA) 163.50p 1.30%
WH Smith (SMWH) 1,727.00p 1.17%
Beazley (BEZ) 358.20p 1.16%
Smith (DS) (SMDS) 334.90p 1.12%
Rexam (REX) 593.50p 1.11%

FTSE 250 - Fallers

Sophos Group (SOPH) 185.20p -10.18%
Evraz (EVR) 59.25p -7.71%
Vedanta Resources (VED) 225.60p -7.54%
Allied Minds (ALM) 279.00p -6.47%
Enterprise Inns (ETI) 74.60p -5.57%
CLS Holdings (CLI) 1,399.00p -5.47%
Tullow Oil (TLW) 166.20p -5.35%
Redrow (RDW) 400.60p -5.07%
Aldermore Group (ALD) 184.00p -5.01%
IP Group (IPO) 152.00p -5.00%