Blue chips and mining stocks lead FTSE fall

UK blue chips suffered losses on the London market today as investors rushed to bank profits made yesterday in the mining sector.

The FTSE 100 Index fell 49.1 points to 6556.9 in mid-morning trading, with heavily-weighted miners leading the drop.

The falls follow an impressive session for mining majors yesterday, made on the back of fresh consolidation hopes.

Investors also moved to take profits ahead of tomorrow’s US interest rates decision, which is widely expected to see a quarter point cut.

The rate hopes saw the dollar fall to a new 26-year low against the pound, helped by comments from Monetary Policy Committee member Kate Barker, which reinforced views that the UK is not in line for an imminent reduction in the cost of borrowing.

The weakness of the dollar has been lending support to oil price rises, but the cost of crude slipped back today, sending shares in BP down 6p to 628p. Royal Dutch Shell also declined, off 17p at 2117p.

But Vedanta Resources was the leading faller, down 100p at 2130p, with similar losses seen among sector peers Antofagasta, down 24p at 836.5p and Anglo American off 81p at 3271p.

Sugars and ingredients group Tate & Lyle was also suffering, down more than 3%, or 15p, to 426.25p amid nerves over interim results tomorrow after a profits warning in September.

Other fallers included Embassy maker Imperial Tobacco, down 25p at 2418p despite pre-tax profits in line with expectations. Profit taking is thought to be partly to blame for the falls, alongside concerns over the group’s Altadis takeover and integration risks.

The leading blue chip riser was investment firm Schroders, after better than expected third-quarter results lifted the stock 66p higher to 1542p, a gain of 5%.

Elsewhere, replica kit maker Umbro saw shares climb 3%, or 5.75p, to 194.75p amid speculation of another bid for the group, which could rival Nike’s plans to buy the firm.