London close: Stocks, commodities drop after Chinese slowdown

15th Apr 2013 17:04

Worries surrounding the global economy hammered equities worldwide on Monday after disappointing growth figures from China sparked a sell-off across commodity markets and the mining sector.A better-than-expected first-quarter earnings report from US bellwether Citigroup did little to lift sentiment this afternoon, with indices on Wall Street falling sharply from the off after the Empire State manufacturing survey and NAHB housing market index both missed estimates."Anyone hoping for a quiet start to the week in the lead up to this week's G20 and IMF meetings got a rude awakening as European markets dropped sharply on the open," said Michael Hewson, the Senior Market Analyst at CMC Markets.London's FTSE 100 fell as much as 84 points (-1.3%) earlier in the day following the Chinese data but had recovered to post a loss of 41 points (-0.6%) on the day by the close.China's first-quarter gross domestic product (GDP) growth dropped from 7.9% in the prior quarter to 7.7% (consensus forecast: 8.0%), sparking concerns about demand from the world's second-largest economy. The reading still remains above China's 2013 GDP growth target of 7.5%, but will scale back hopes for any material upside surprise to official forecasts."The poor China data follows a week after a batch of poor US economic data, reinforcing the markets' worry that the global recovery could be derailed," said Market Strategist Ishaq Siddiq from ETX Capital.Spot gold prices were trading down 7.2% at $1,367.04 an ounce before the close in London, down nearly $109 on the day, after Citigroup today joined the growing list of brokers to downgrade its price forecasts for the yellow metal. Gold had reached its lowest level since February 2011.Meanwhile, the silver price was down 10.25% at $23.34 an ounce, its worst value since October 2010.FTSE 100: Precious metals miners hammeredPrecious-metal stocks were posting sharp falls by the close of trade today as gold and silver prices were hit hard by the Chinese slowdown, prompting investors to turn to relatively 'safer' assets. Fresnillo, Randgold and Polymetal were among the worst performers with the latter being dragged down further by a ratings cut from Citigroup to 'sell'. Its price target was cut from 274p to 141p. EVRAZ, Antofagasta, Xstrata, Glencore and ENRC were also registering steep losses today.Rio Tinto was firmly lower after an Australian judge rejected the miner's plan to expand a coal mine in the wine-growing region of Hunter Valley. The judge cited "the significant, adverse, biological diversity, noise and dust, and social impacts of the project."With miners bearing the brunt of a fall in risk appetite, defensive sectors were at the top of the pile: stocks that are expected to hold up relatively well during tough economic conditions were performing well, such as pharmaceuticals (GlaxoSmithKline), utilities (United Utilities, SSE, Centrica) and food stocks (AB Foods).United Utilities was also being lifted by M&A speculation after The Sunday Times reported that the firm has hired Goldman Sachs to help keep itself defended against any possible hostile take-over attempts. The company said this was standard procedure. Meanwhile, British gas owner Centrica was on the rise after buying several natural gas and crude oil assets in Canada. FTSE 250: Petropavlovsk drops a quarter in mining sell-offMining stock Petropavlovsk plunged by nearly a quarter after Citi downgraded the stock to 'sell' and cut its forecasts for gold. Other miners, including Bumi, Centamin, Ferrexpo, Hochschild and African Barrick Gold were also falling sharply.High Street bookie Ladbrokes fell after it said it has said that it had experienced softer-than-expected trading in the first quarter due to a number of one-off factors. As such, the company said that - coupled with its revised 2013 outlook for its Digital business following a deal with Playtech in March - group operating profits for the year will be at the bottom of the existing market range.Online peer Betfair was the strongest riser on the second-tier index following an announcement by CVC Capital Partners, in which it said it is considering making an offer for the group.FTSE 100 - RisersGlaxoSmithKline (GSK) 1,630.50p +3.89%easyJet (EZJ) 1,138.00p +3.17%International Consolidated Airlines Group SA (CDI) (IAG) 250.40p +2.79%United Utilities Group (UU.) 739.00p +2.50%Severn Trent (SVT) 1,733.00p +1.58%Smith & Nephew (SN.) 763.50p +1.33%National Grid (NG.) 803.00p +1.32%Hargreaves Lansdown (HL.) 893.00p +1.13%Associated British Foods (ABF) 1,864.00p +1.08%AstraZeneca (AZN) 3,340.00p +0.62%FTSE 100 - FallersFresnillo (FRES) 1,080.00p -15.16%Polymetal International (POLY) 746.00p -13.15%Randgold Resources Ltd. (RRS) 4,545.00p -8.33%Antofagasta (ANTO) 937.00p -7.50%Xstrata (XTA) 966.30p -7.35%Glencore International (GLEN) 321.10p -6.71%Evraz (EVR) 171.90p -6.27%Tullow Oil (TLW) 1,097.00p -5.43%Eurasian Natural Resources Corp. (ENRC) 238.10p -4.53%Wood Group (John) (WG.) 817.00p -4.28%FTSE 250 - RisersBetfair Group (BET) 782.00p +11.79%Dixons Retail (DXNS) 35.40p +2.37%BH Global Ltd. USD Shares (BHGU) 11.99 +2.04%Man Group (EMG) 106.20p +1.72%Perform Group (PER) 497.80p +1.70%Jardine Lloyd Thompson Group (JLT) 841.00p +1.33%Interserve (IRV) 487.50p +1.33%CSR (CSR) 502.50p +1.13%3i Group (III) 324.80p +1.12%Hikma Pharmaceuticals (HIK) 1,003.00p +1.01%FTSE 250 - FallersPetropavlovsk (POG) 141.80p -24.01%Bumi (BUMI) 249.50p -15.14%Centamin (DI) (CEY) 37.83p -12.02%New World Resources A Shares (NWR) 192.00p -10.20%Kazakhmys (KAZ) 340.80p -9.02%African Barrick Gold (ABG) 173.40p -8.64%Hochschild Mining (HOC) 240.90p -8.37%Ferrexpo (FXPO) 167.00p -8.14%Ladbrokes (LAD) 190.30p -8.02%Lonmin (LMI) 256.60p -7.83%BC