Miners, retailers lead FTSE down, financials support

By David Brett

LONDON (BestGrowthStock) – Britain’s top shares fell on Wednesday, as downbeat earnings news weighed on Cobham and Next , while falling miners outpaced gains in financials as car insurer Admiral met analysts’ expectations.

British aerospace electronics group Cobham fell as much as 10 percent after it said continued delays in the award of U.S. defense contracts would dent full-year revenues, and that it was uncertain about its growth prospects in the fourth quarter.

By 0903 GMT, the FTSE 100 was down 5.50 points, or 0.1 percent at 5,751.93, having added 1.1 percent on Tuesday ahead of the outcome of the U.S. Federal Reserve’s policy meeting due later on Wednesday.

“The market has written in about $500 billion (of quantitative easing) and if the Fed goes in on the cautious side the market will not like it and will come off,” Martin Dobson, head of sales trading at Westhouse Securities, said.

“There is talk of the market forming a head and shoulders on the bearish side, and sentiment is fairly muted and volatility will come back in after the Fed has made up its mind.”

Investors booked profits on mining stocks, which have risen in recent days as metals rallied on quantitative easing (QE) hopes.

BHP Billiton shed 0.5 percent as Russian business daily Vedomosti reported Russian fertilizer company Phosagro is planning to bid for Potash Corp, rivaling BHP Billiton’s $39 billion offer which awaits a crucial ruling from the Canadian government.

NEXT SALES FALL

Downbeat earnings from Britain’s number two fashion retailer put pressure on the sector. Next maintained its guidance for full year profit as a strong third-quarter performance from its home shopping business offset a fall in sales at its stores.

Next fell 4.0 percent, while Marks & Spencer dropped 2.2 percent as RBS repeated its “sell” rating ahead of the firm’s update due on Nov 9.

“We anticipate tougher two-year rolling like-for-like comparisons into FY12 and FY13, and see a greater risk of declining UK consumer confidence and spending,” the broker said in a note.

Banks were mainly higher, with Lloyds Banking Group rebounding 1.9 percent having fallen sharply on Tuesday on worries over its bad loans after reporting results.

Barclays added 0.2 percent ahead of its update on November 9, HSBC rose 1.0 percent with its update due on Friday, and Standard Chartered was up 1.2 percent.

Royal Bank of Scotland, due to issue an update on Friday, was down 0.4 percent.

Elsewhere, British car insurer Admiral rose 2.2 percent after it said it was on course to meet analysts’ profit forecasts for the year after third-quarter turnover rose more than 50 percent to 446 million pounds ($716.5 million).

Experian climbed 1.8 percent with analysts pointing to favorable political developments in the United States where the credit checking company has significant exposure.

Oil giant BP rose 1.2 percent, bucking a weaker energy sector as investors locked in gains, after Goldman Sachs upgraded the oil major to “buy” from “neutral” following results on Tuesday.

(Editing by Sharon Lindores)

Miners, retailers lead FTSE down, financials support