Sector movers: Oil and mining stocks track commodities lower, Brent drops

A sell-off across the commodities market on Tuesday meant that the oil and mining sectors were the worst performers on London's stock market, as falling crude and metal prices prompted concerns about companies' bottom lines.

Stocks such as Tullow Oil, BG Group, Afren, Premier Oil, Shell and BP were all trading in the red in afternoon trade.

Brent dropped to its lowest in four years on worries that the Organization of Petroleum Exporting Countries (OPEC) won't act to curb a supply glut at its upcoming meeting this month.

OPEC's 12 members, who supply around 40% of global oil, are due to meet in Vienna on 27 November and are under pressure to scale back output. Certain nations, reluctant to slow down production, have instead lowered their export prices to the US, where output is running at its highest rate in three decades.

Brent futures for December delivery were down 0.5% at $81.95 a barrel on Tuesday, having earlier touched an October 2010-low of $81.23. Prices have now fallen by around 30% since a peak in June.

Kuwait's oil minister Ali Al-Omair was cited as saying in confidence that OPEC will not collectively cut output at its meeting.

He said: “We feel prices will settle down once surplus oil is absorbed.”

Meanwhile, mining groups Anglo American, Rio Tinto, Antofagasta, Hochschild and Lonmin were all suffering losses as metal prices weakened.

Also weighing on sentiment in the sector was Citigroup's prediction that iron-ore prices will drop to under $60 a metric tonne next year as supply increases amid weak demand. The bank expects iron ore to average $72 a tonne in the first quarter of 2015, down from its earlier estimate of $82.

Top performing sectors so far today

Mobile Telecommunications 4,897.42 +4.65%
Real Estate Investment Trusts 2,981.26 +1.23%
Household Goods & Home Construction 12,263.66 +1.09%
Electricity 9,862.09 +1.07%
Software & Computer Services 1,147.47 +0.97%

Bottom performing sectors so far today
Oil & Gas Producers 7,565.43 -1.68%
Fixed Line Telecommunications 4,220.26 -1.67%
Mining 15,292.27 -1.37%
Automobiles & Parts 7,493.50 -1.20%
Construction & Materials 3,657.67 -1.16%