Sector movers: Metals and mining stocks dive for third successive day

London-listed metals and mining stocks continued to suffer for the third successive day on Wednesday, with the Greek debt crisis showing few signs of abating.

However, the blue chip FTSE 100 staged a minor recovery closing up 1.34% or 87.61 points at 6608.59, led back into the green by high-yield tobacco stocks as traders began the new quarter for the sector on a positive note.

British American Tobacco was trading up by 2.45% or 83.50p at 3498.5p while Imperial Tobacco was up 1.73% or 53p at 3,120p. With both blue chips in the green, tobacco stocks topped the sector leader-board up 911.80 points or 2.23% at 41,840.22.

Pharmaceuticals and biotechnology (up 2.09%), beverages (up 1.95%) and insurers (up 1.89%) sectors were next in line on a day that saw Greece dominate the headlines, as the country’s government offered yet another last minute deal, but forged ahead with a referendum on whether Athens should or shouldn’t accept proposals from Brussels.

Fears of wider economic malaise in Europe, lower demand from China coupled with an upping of metals exports by Beijing, and general oversupply permutations saw mining and metals stocks extend their poor run for yet another trading session.

Trends suggest a wider recovery in the industrial metals market would remain elusive, with analysts at Macquarie expressing concerns about the direction of aluminium prices, forecasting “many years of pain.”

Investors continued to short mining stocks as even precious metals – including gold and silver – dipped into the red for much of the European session. Invariably, four of the biggest five blue chip fallers of the day were all mining stocks – namely Randgold Resources (down 1.63%), Antofagasta (down 1.31%), Anglo American (down 0.91%) and Glencore (down 0.90%).

On the FTSE 250, four of the biggest five fallers included Lonmin (down 2.86%), Acacia Mining (down 2.29%), Evraz (down 2.19%) and Vedanta Resources (down 2.12%).

Additionally, lower oil prices triggered a sell-off in oil and gas shares with midcaps Nostrum Oil & Gas (down 2.11%), Cairn Energy (down 1.94%) and Premier Oil (down 1.88%) trading lower.

Tullow Oil, which published a fresh approach to its business and a positive production update from Ghana, could not escape bearish sentiment either, shedding 1.97% or 6.7p to 333.00p. Additionally, blue chip BP was also marginally in the red, ending the session 0.24% at 419.25p.