FTSE beats a retreat as miners slide with metals

* FTSE down 0.3 percent

* Miners follow metals prices down

* Rolls-Royce falls as Quantas grounds jets for longer

By David Brett

LONDON, Nov 8 (BestGrowthStock) – Miners led Britain’s top shares
lower on Monday as metal prices eased, and with strike
uncertainty hitting Xstrata (XTA.L: ) and Anglo American (AAL.L: ),
while African Barrick Gold (ABGL.L: ) was weighed on by a broker
downgrade.

By 1147 GMT, the FTSE 100 (.FTSE: ) was down 16.54 points, or
0.3 percent, at 5,858.81, having hit a 29-month closing high on
Friday after the U.S. Federal Reserve committed on Wednesday to
stimulating growth by pumping another $600 billion of new money
into the U.S. economy.

“Mining stocks eased back from Friday’s levels, underlying
metal prices edged lower and the dollar posted muted gains,
dragging the mining sector away from last week’s highs,” Giles
Watts, head of equities at City Index, said.

A strike by union workers at the world’s third biggest
copper mine, Chile’s Collahuasi, headed into a fourth day on
Monday with no visible impact on output yet as wage talks
remained stalled.

The union has vowed a long strike at the mine, which
produces 535,000 tonnes a year, or 3.3 percent of the world’s
mined copper and is owned by Xstrata and Anglo American.

Xstrata and Anglo American were down 1.4 and 1.5 percent
respectively.

African Barrick Gold shed 2.6 percent after Goldman Sachs
downgraded its rating on the shares to a “sell” from “neutral”,
and reduced its earnings estimates after recent cuts to the
firm’s production guidance.

Eurasian Natural Resources (ENRC.L: ), bucked the weaker
sector trend, however, climbing 0.6 percent ahead of its
third-quarter production report on Thursday.

Energy stocks (.FTNMX0530: ) declined in tandem with a fall in
the crude price (CLc1: ). Tullow Oil (TLW.L: ) dropped 1.2 percent
as Goldman Sachs cut its rating on the stock to “neutral” from
“buy”.

Negative broker sentiment also put pressure on Scottish &
Southern Energy (SSE.L: ), down 1.8 percent, with Nomura cutting
its rating on the utility to “reduce” from “neutral”.

ENGINE WORRIES

Aero-engine maker Rolls-Royce (RR.L: ) dipped a further 0.6
percent as Australia’s Qantas Airways (QAN.AX: ) grounded its
Airbus A380 fleet for at least three more days while it
investigated oil leaks that might have caused the engine
explosion on a Sydney-bound flight last week.

The incident has rattled the global aviation industry, which
is recovering from heavy losses during the global economic
downturn, and has been damaging for Rolls-Royce, its shares
having dropped nearly 10 percent. [ID:nSGE6A6045]

On the upside, satellite operator Inmarsat (ISA.L: ) rose 4
percent after beating Q3 earnings expectations. [ID:nLDE6A70BI]

Invensys (ISYS.L: ) gained 2.3 percent as Credit Suisse
joined a crop of brokers who have recently raised their target
prices on the engineering group.

“We’ve had a quiet start this morning, a lot of good news
seems to be out of the way with (the Federal Reserve’s new round
of quantitative easing) QE2 and non-farm payrolls last week,”
Manoj Ladwa, senior trader at ETX Capital, said.

“The market looks relatively overbought at the top of the
trading channel. We could see some money being taken off the
table,” he said.

U.S. stock index futures (SPc1: ) (DJc1: ) (NDc1: ) pointed to a
slightly lower open on Wall Street on Monday, with no major
economic data due for release.
(Editing by Greg Mahlich)

FTSE beats a retreat as miners slide with metals