Miners, Bunzl tug FTSE 100 lower

April 17
15:10 2019

(Reuters) – Britain’s main index retreated from a six-month high on Wednesday as miners fell on Vale’s plans to reopen a major Brazilian mine and Bunzl sank after flagging slowing quarterly revenue growth.

The FTSE 100, which had climbed to its highest since early October the day before, edged 0.1 percent lower by 0856 GMT. Mid-caps were up 0.1 percent.

Miners lost 2.1 percent and were on course for their worst day in almost six weeks after Vale SA said it expected to resume operations at its Brucutu mine within 72 hours.

London-listed shares in Rio Tinto fell 3.3 percent and BHP, the world’s biggest miner, gave up 3.1 percent after cutting its iron ore output target following a tropical cyclone.

Business supplies distributor Bunzl fell 7.7 percent and was on course for its worst day in a decade after reporting a slowdown in quarterly growth due to sluggish performance of its grocery and retail business in North America, its biggest market.

The sour mood persisted despite Asian shares gaining on forecast-beating Chinese economic growth data, which analyst Neil Wilson attributed to stimulus measures taken by Beijing and U.S. President Donald Trump’s decision not to raise tariffs in March.

“Nevertheless, despite these better figs, we should remind ourselves that China is growing at its weakest pace in about three decades,” Wilson said.

Positive data from China brought back some appetite for riskier holdings and hurt safe haven assets. As a result, dollar earners including AstraZeneca, GlaxoSmithKline and Diageo were among the biggest drags on the main bourse.

However, the index trimmed losses slightly after data showed that UK inflation in March was at the same level as the previous month.

London-listed shares of German tour operator TUI outperformed with a 4 percent gain.

Among mid-caps, London-listed shares of Mediclinic rose more than 10 percent. The company forecast annual core profit would fall in line with the market expectations.

Housebuilder Countryside advanced 5.7 percent after an upbeat half-year trading update.

Telecom Plus slipped 2.6 percent after warning that full-year profit would be lower than expected.

On the small-cap index, car dealership chain Pendragon slipped 5.8 percent after it said it would review its operational and financial prospects under its new management following margin pressures that led to a quarterly loss.

(Reporting by Muvija M and Shashwat Awasthi in Bengaluru; Editing by Mark Heinrich)

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