September 1, 2015 / 2:18 PM / 2 years ago

UK shares head for worst one-day fall in over a week

* FTSE 100 down 2.8 pct after China data
    * Only two FTSE 100 components in positive territory
    * Mining stocks BHP Billiton, Anglo American down over 5 pct
    * Engineering firm Meggitt is top gainer

 (Updates prices, adds detail)
    By Kit Rees and Lionel Laurent
    LONDON, Sept 1 (Reuters) - UK shares fell more than 2
percent on Tuesday, set for their worst one-day fall in over a
week and with miners hit hardest after a slump in the
manufacturing sector in China - the world's biggest commodity
consumer - rattled global markets.
    All but two FTSE 100 stocks were in negative
territory at 1343 GMT on Tuesday, London's first trading day of
the week after a public holiday on Monday.
    Policymakers worldwide have turned more interventionist with
a surge in market volatility to levels not seen since the 2008
financial crisis. China's central bank has already repeatedly
intervened to stabilise the yuan since its Aug. 11 devaluation
sent shockwaves through global markets.
    "We are sellers across the board," said Mark Ward, head of
execution trading at London-based Sanlam Securities. "People are
getting back from holidays and trying to make sense of what is
going on.
    "The China headlines are not helping but I would say it's
probably more down to sentiment than a huge shift in the actual
economic outlook."
    The FTSE 100 was down 2.8 percent, lagging the pan-European
FTSEurofirst 300, down 2.6 percent.
    "As it stands we've pretty much wiped off any of the gains
we saw last Friday ... it does seem like this could be another
return to the lows we saw last week, particularly if we don't
see any effects from the Chinese interventions any time soon,"
said Brenda Kelly, head analyst at London Capital Group. 
    China's official Purchasing Managers' Index (PMI) fell to
49.7 in August from the previous month's reading of 50.0, the
weakest showing in three years. 
    That was followed by releases of weak PMI data for both
Britain and the euro zone showing manufacturing growth had eased
last month.  
    The index's top gainer was engineering components firm
Meggitt, rising 1.5 percent, with a trader citing a
pick-up in auto sales and a government pledge to spend more than
500 million pounds refurbishing a nuclear submarine base in
Scotland. [ID:nL5N1172TB}
    Miners Glencore, Anglo American, BHP
Billiton and Antofagasta were down more than 5
percent, leading the fallers as metals prices fell on China
demand fears.  
    In the mid caps, China worries also hit shares of hedge-fund
manager Man Group, down 4.5 percent after the boss of
its China unit was reportedly taken into custody as part of a
probe into the causes of recent market volatility.

 (Reporting by Lionel Laurent; Editing by John Stonestreet and
Raissa Kasolowsky)

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