Sector movers: Natural resource stocks hammer London market

Declines in metal and oil futures saw commodities linked stocks drag the London lower on Thursday, as extractive industries associated with copper were left feeling the heat in particular.

The FTSE 100 ended 0.75% or 47.98 points lower at 6,364.90, while the FTSE 250 was down 0.38% or 65.37 at 17117.13. At 1703 GMT, Brent was down 0.25% or 12 cents to $48.46 per barrel while the WTI was down 0.82% or 38 cents at $45.94 per barrel. An extremely volatile session saw both benchmarks post gains in early Asian trading, only to slip into decline in Europe, before yet again staging a minor clawback in early US trading.

While oil and gas blue chips – Shell and BP – saw a lacklustre day of trading, four of the five biggest fallers on the FTSE 250 came from the sector, with Amec Foster Wheeler (down 23.16%), Premier Oil (down 9.09%), Wood Group (down 8.77%) and Petrofac (down 8.47%) all trading lower.

Additionally, Amec Foster Wheeler announced it was cutting its dividend by half and lifting the corporate cost-savings target by $55m to $180m (£120m) by 2017. Mining stocks also felt the heat as late afternoon trading on the London Metal Exchange saw the three-month copper delivery futures contract fall 2.3% to $5,052.75 per metric tonne, lurking around one month lows.

Additionally, primary aluminium (down 0.5%), lead (down 1.7%), nickel (down 1.9%), tin (down 2.0%) and zinc (down 2.0%) futures also traded lower in the face of a stronger dollar. Anglo American (down 7.68%) fell to a 16-year low of 534.60p dented chiefly by the copper price decline. Randgold Resources (down 4.43%) continued to suffer from a lacklustre gold market, rounding up a tepid day for mining stocks.

FTSE 250 Travel company Thomas Cook (down 7.27%) was under the cosh after British Prime Minister David Cameron decided late on Wednesday to ground all UK-bound flights from Sharm el-Sheikh in Egypt following the Russian plane crash in the Sinai desert last week. Investors were concerned that the move could reduce demand for holidays in Egypt.

On the positive side, housebuilders and property linked stocks staged a recovery after data from the Halifax suggested UK house prices had jumped by 1.1% month-on-month in October. Blue chip Persimmon (up 2.21%) and midcap Foxtons (up 3.52%) were among the main beneficiaries.