Metal stocks rock the FTSE as oil slide effects continue - London Report

THE FTSE 100 slumped more than two per cent lower yesterday following a plunge in metal stocks.

Global growth concerns prompted jittery investors to exit mining stocks en masse.

The mining sub-index dropped 6.2 per cent, the biggest one-day percentage fall in three years, after copper fell as much as eight per cent to its lowest in more than five years.

Tuesday’s downward revision by the World Bank to its global growth forecasts triggered a wave of stop-loss selling of the metal, which has numerous industrial uses.

The bank said disappointing economic prospects in the Eurozone, Japan and some major emerging economies would offset the benefit of lower oil prices.

“It’s a straight read-across. Global growth estimates are being revised down and metals prices are slumping, forcing large investors to cut their exposure to the sector,” said David Battersby, investment manager at Redmayne-Bentley.

The FTSE 100 closed 2.4 per cent lower at 6,388.46 points.

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