Asian-Exposed Banks Hamper The FTSE 100

Tue, 18th Nov 2014

The FTSE 100 enjoyed a mixed trading session on Monday, slipping early in the day thanks to jitters in global markets, before recovering thanks to some reassuring words from Mario Draghi, president of the ECB.

Draghi promised that if interest rates do not improve in the near future in the Euro-zone, he will consider the purchase of government bonds to stimulate the economy. The ECB has already instituted some other stimulus measures, but to date they have not proven particularly effective.

Financial stocks hit the market hard, with banks that have heavy exposure to Asia tanking the biggest toll on the market, seeing some heavy selling. Standard Chartered and HSBC were the worst performers during the morning trading session, losing 1.9 percent and 1.2 percent early in the day, respectively.

Oil stocks also dragged down the market, as concerns about the global growth outlook contributed to continuing uncertainty in the sector. BG group lost 1.5 percent on Monday morning, with Tullow Oil losing 1.1 percent. Oil prices had recovered slightly towards the end of last week, but there are many analysts that believe that the price of Brent Crude will remain below $80 a barrel for the foreseeable future.

There was some support in the form of defensive properties. Precious metals stocks made some noteworthy gains, with Randgold Resources and Fresnillo being among the top performers of the day. Other companies that posted gains later in the trading session included ARM Holdings and BSkyB.

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