LONDON (ShareCast) - - Stocks swing sharply into red in afternoon trade
- Renewed EM currency volatility follows rate hikes
- Wall Street lower ahead of Fed decision
- Miners rise after strong updates, Sainsbury boss exits

techMARK 2,768.00 -0.48%
FTSE 100 6,544.28 -0.43%
FTSE 250 15,688.31 -0.18%

Market volatility returned in full force on Wednesday as UK stocks swung sharply into the red on the back of renewed concerns surrounding emerging markets and nervousness ahead of a policy decision in the States.

The FTSE 100, which hit a high of 6,645.23 early on, dropped over 160 points to an intraday low of 6,482.74 this afternoon, before paring gains slightly before the close. The index finished 28.05 points lower at 6,544.28, a 0.4% fall on the day.

Developing-nation currencies came under renewed pressure today despite central banks in Turkey, India and South Africa moving to tighten policy in an attempt to stabilise prices after a recent sell-off. After initial strength this morning, the Turkish lira and South African rand both fell against the US dollar while the Indian rupee erased an earlier advance.

The currency weakness following an increase in interest rates “opens up a new, and potentially more worrying, phase of the recent turmoil in EM financial markets in which beleaguered policymakers find themselves unable to defend their currencies”, according to analysts at Capital Economics.

UK markets were dampened further this afternoon after a weak start on Wall Street as traders awaited the outcome of the Federal Open Market Committee meeting later this evening.

To take into account, critical remarks from Turkey's PM regarding the central bank's decision could conceivably weaken attempts to prop up the country's currency.

The Fed, which began tapering its stimulus programme last month by cutting monthly asset purchases from $85bn to $75bn, is widely expected to cut another $10bn today. However, the impact that the potential move will have on the emerging markets is still very much up in the air.

Miners gain, Sainsbury slumps

Mining stocks managed to hold on to gains today despite the wider market sell-off after some well-received production updates from blue-chip metal producers Antofagasta, Anglo American and Randgold Resources.

Antofagasta was a high riser after unveiling a record year of copper production for 2013 and giving guidance for 2014 output that impressed; Anglo American also rose as it reported an increase in iron ore, copper, nickel and thermal coal production in the fourth quarter; Randgold Resources gained after saying that its Loulo-Gounkoto gold mine in Mali is likely to beat its revised production target for 2013.

Heading the other way was Sainsbury as the departure of its long-running Chief Executive received a negative reaction from markets.

United Utilities and BSkyB were among the worst performers ahead of their quarterly updates due out tomorrow morning.

Investors at financial services group Old Mutual were underwhelmed by the company’s plans for an expansion of its African business, with shares falling sharply this afternoon. Sector peer Prudential also finished lower.

Carphone Warehouse jumped after being signed as the preferred partner of Samsung Electronics to operate more than 60 Samsung stand-alone stores across Europe.

Luxury handbag and fashion group Mulberry plunged following a profit warning after UK Christmas trading fell short of hopes due to rival price-cutting.


FTSE 100 - Risers
Antofagasta (ANTO) 872.50p +6.08%
Anglo American (AAL) 1,420.50p +5.73%
Fresnillo (FRES) 781.50p +4.06%
Randgold Resources Ltd. (RRS) 4,235.00p +3.17%
Royal Mail (RMG) 590.00p +1.99%
Weir Group (WEIR) 2,143.00p +1.61%
Vodafone Group (VOD) 226.30p +1.34%
Rio Tinto (RIO) 3,247.50p +1.07%
Next (NXT) 6,230.00p +0.97%
TUI Travel (TT.) 422.00p +0.96%

FTSE 100 - Fallers
William Hill (WMH) 330.50p -3.08%
British Sky Broadcasting Group (BSY) 844.50p -2.60%
United Utilities Group (UU.) 719.00p -2.44%
Prudential (PRU) 1,244.00p -2.35%
Sainsbury (J) (SBRY) 348.50p -2.30%
Old Mutual (OML) 176.10p -2.22%
Meggitt (MGGT) 515.50p -2.00%
BT Group (BT.A) 369.90p -1.94%
British American Tobacco (BATS) 2,929.00p -1.88%
Pearson (PSON) 1,104.00p -1.87%

FTSE 250 - Risers
Carphone Warehouse Group (CPW) 287.20p +6.69%
Laird (LRD) 325.00p +5.21%
COLT Group SA (COLT) 127.10p +4.61%
African Barrick Gold (ABG) 222.00p +4.32%
Lonmin (LMI) 328.40p +4.22%
Petra Diamonds Ltd.(DI) (PDL) 136.40p +4.12%
Homeserve (HSV) 311.20p +4.08%
Howden Joinery Group (HWDN) 333.70p +4.05%
Bank of Georgia Holdings (BGEO) 2,177.00p +3.67%
Perform Group (PER) 244.70p +3.64%

FTSE 250 - Fallers
Cairn Energy (CNE) 213.70p -5.61%
Evraz (EVR) 88.85p -4.62%
BTG (BTG) 583.00p -3.72%
Daejan Holdings (DJAN) 4,737.00p -3.68%
Rank Group (RNK) 128.00p -3.40%
Brewin Dolphin Holdings (BRW) 293.00p -3.08%
Renishaw (RSW) 1,799.00p -2.91%
Investec (INVP) 386.40p -2.87%
Pennon Group (PNN) 678.50p -2.86%
Merchants Trust (MRCH) 489.00p -2.59%

BC

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