London close: Stocks end lower as oil prices weigh

Oil prices continued to head south on concerns about oversupply in the market and lack of demand. Brent crude fell 1.51% to $36.33 per barrel and West Texas Intermediate declined 1.06% to $35.68 per barrel at 1621 GMT.

“If the FTSE is going to achieve the notorious Santa rally this month, either oil prices will have to turn a corner, or else the disconnect between crude prices and oil stocks, as seen today, will need to continue,” said Josh Mahoney, market analyst at IG.

Going the other way, mining stocks rallied with Glencore a major riser on the FTSE 100 after Citi reiterated its ‘buy’ rating on the company's latest investor day. Citi said the company will be able to deliver on the promises made, with possible asset sales holding the greatest potential to move markets.

Fresnillo and Anglo American were also on the front foot as metal prices rose. On the Comex gold rose 1.26%, silver jumped 1.34% and copper increased 1.21%, recovering from losses last week.

Meanwhile, Spain faces political uncertainty after anti-austerity party Podemos and liberal Ciudadanos made big gains as the conservative Popular Party (PP) lost its majority.

Sunday’s vote sees prime minister Mariano Rajoy’s PP ostensibly still in power, but with 123 seats away from a majority.

"It’s like the Greek election saga in a minor key, one that poses a host of new problems for a country that has spent the last few months gradually sinking to the bottom of the Eurozone’s unofficial performance chart," said Connor Campbell, financial analyst at Spreadex.

In macroeconomic data, high street sales growth accelerated in the year to December, according to the Confederation of British Industry’s latest monthly Distributive Trades Survey.

However, growth was a little weaker than expected, with the retail sales balance rising to +19 from +7 the previous month, compared with estimates of +21.

German producer prices posted their sharpest annual drop in nearly six years in November as energy prices dragged, according to data released by Destatis.

Producer prices slipped 0.2% on the month and 2.5% compared with the corresponding month last year. Economists had expected a 0.2% decline from last month and a 2.4% fall on the year.

In the US, the Chicago Fed National Activity Index was -0.30 in November, down from -0.17 in October. Analysts had expected a reading of +0.10. The drop was led by a fall in the production-related indicators. The three-month moving average fell to -0.20 from -0.18.

On the company front, ITV’s shares rallied after a report in the Mail on Sunday that it has started talks with US media colossus Comcast about a potential £11bn takeover bid for the broadcaster.

Primark owner Associated British Foods declined after RBC Capital Markets downgraded the stock to 'underperform' from 'sector perform'.

Dairy Crest rose as it took full ownership of its galacto-oligosaccharide business on Monday.

Tullow Oil advanced after RBC Capital Markets lifted its rating from ‘sector perform’ to ‘outperform'.

Coca-Cola HBC was a top faller as the company continued its share buyback programme. It announced before the markets opened that it had repurchased another 100,000 shares for an average price of 1,498.35 per share, taking the total number of shares repurchased to 2,899,088.

Market Movers

FTSE 100 (UKX) 6,054.12 0.03%
FTSE 250 (MCX) 17,108.90 0.02%
techMARK (TASX) 3,153.08 -0.23%

FTSE 100 - Risers

ITV (ITV) 272.00p 3.11%
Antofagasta (ANTO) 427.80p 2.76%
Glencore (GLEN) 83.05p 2.71%
InterContinental Hotels Group (IHG) 2,591.00p 2.70%
Carnival (CCL) 3,727.00p 2.17%
Fresnillo (FRES) 671.50p 1.90%
Sainsbury (J) (SBRY) 259.60p 1.72%
Standard Life (SL.) 380.60p 1.66%
Dixons Carphone (DC.) 484.00p 1.45%
Tesco (TSCO) 145.30p 1.29%

FTSE 100 - Fallers

Coca-Cola HBC AG (CDI) (CCH) 1,453.00p -3.13%
Smith & Nephew (SN.) 1,143.00p -2.47%
Associated British Foods (ABF) 3,248.00p -2.37%
Ashtead Group (AHT) 1,095.00p -1.35%
Rolls-Royce Holdings (RR.) 569.50p -1.21%
Admiral Group (ADM) 1,635.00p -1.21%
BP (BP.) 335.20p -1.21%
Royal Dutch Shell 'A' (RDSA) 1,450.00p -0.92%
Unilever (ULVR) 2,795.50p -0.90%
Royal Dutch Shell 'B' (RDSB) 1,456.50p -0.85%

FTSE 250 - Risers

Drax Group (DRX) 231.60p 4.99%
Acacia Mining (ACA) 167.20p 4.83%
Centamin (DI) (CEY) 62.65p 4.68%
Hastings Group Holdings (HSTG) 172.90p 4.31%
Moneysupermarket.com Group (MONY) 356.20p 4.18%
Allied Minds (ALM) 399.90p 4.11%
Bodycote (BOY) 571.50p 3.91%
Polymetal International (POLY) 540.50p 3.74%
Halfords Group (HFD) 333.90p 3.66%
Evraz (EVR) 65.15p 3.66%

FTSE 250 - Fallers

Telecom Plus (TEP) 1,049.00p -4.72%
International Personal Finance (IPF) 292.20p -4.35%
Riverstone Energy Limited (RSE) 751.00p -3.72%
Ted Baker (TED) 3,205.00p -3.23%
Petrofac Ltd. (PFC) 744.50p -3.06%
National Express Group (NEX) 321.60p -3.04%
Jupiter Fund Management (JUP) 445.50p -2.62%
OneSavings Bank (OSB) 354.40p -2.37%
Rathbone Brothers (RAT) 2,170.00p -2.30%
Spire Healthcare Group (SPI) 287.30p -2.28%