Sector Movers: Glencore leads FTSE 100, oil midcaps head lower

Resource stocks were in recovery mode on Monday led by Glencore, while a failure of oil futures to maintain their earlier bounce saw oil and gas midcaps head lower.

The FTSE 100 ended 0.39% or 23.01 points lower at 5,877.00, while the FTSE 250 closed 0.12% or 18.99 points higher at 16,146.98. In the absence of any notable economic data, Brent front-month oil futures contract was down 3.70% or $1.19 to $30.99 per barrel, while WTI fell 4.47% or $1.44 to $30.75 per barrel at 1728 GMT, over yet another volatile session following Friday's gains stateside and an early uptick over start to this week’s market proceedings in Singapore.

Elsewhere, headline base metal futures headed lower on the London Metal Exchange. At 1635 GMT, three-month delivery contracts of copper (down 1.1%), lead (down 1.4%), nickel (down 1.7%), tin (down 0.8%) and zinc (down 0.7%) were firmly in negative territory.

Meanwhile, precious metals climbed back above last Wednesday’s highs on renewed safe haven demand. On the COMEX, the front-month gold futures contract posted an uptick of 1.07% or $11.70 to $1,108.00 an ounce, while spot gold was 0.82% or $8.97 higher at $1,106.92 an ounce.

COMEX silver rose 1.37% or 19 cents to $14.25 an ounce, while spot platinum rose 3.47% or $28.90 to $861.40 an ounce. Glencore (up 2.89%) brushed aside a lacklustre commodities market to lead the FTSE 100 higher.

However, oil and gas midcaps tumbled with Tullow Oil (down 5.07%), Weir Group (down 4.80%) and Amec Foster Wheeler (down 4.34%) among the biggest fallers on the FTSE 250. A notable exception was Ophir Energy (up 4.58%), as its shares rose upon signing a non-binding head of terms agreement with Schlumberger, which will receive a 40% interest in the company’s Fortuna project in Equatorial Guinea.

Away from resource stocks, banks were among the biggest fallers after Sky News reported they are preparing to set aside billions of more pounds for provisions against the payment protection insurance mis-selling scandal.

Insiders from Barclays (down 4.67%), Lloyds Banking Group (down 5.56%), Royal Bank of Scotland (down 4.12%) and others told the broadcaster that banks would reveal at least £5bn in fresh provisions alongside their full-year 2015 earnings.

Elsewhere, retailer Kingfisher (down 6.12%) led the FTSE100 fallers as it said profits would take a £50m hit in the first year of its five-year transformation programme. Additionally, Tesco took a hit after Cantor Fitzgerald analyst Mike Dennis said he believed the supermarket may get slapped with a fine of up to £500m by the Serious Fraud Office over its £326m accounting black hole.