* Mining (LSE: MIR.L – news) stocks fall after Chinese factory activity slowdown
* FTSE 100 falls 0.3 percent
* FTSE 100 rose 14.4 pct in 2013
* Many traders see FTSE eventually hitting 7,000 level in 2014
By Sudip Kar-Gupta
LONDON, Jan 2 (Reuters) – Britain’s benchmark equity index, which had its best annual gain in four years in 2013, fell on Thursday as a decline in major mining stocks pegged back the market.
Many traders and investors argue that a gradual economic recovery in Britain will lift the UK stock market to further record highs in 2014.
But a 0.6 percent fall for the FTSE 350 Mining Index took the wind out of the overall market after weak manufacturing data from China – the world’s biggest consumer of metals.
The blue-chip FTSE 100 index, which rose 14.4 percent in 2013 to post its best annual gain since 2009, was down by 0.3 percent, or 21.85 points, at 6,727.24 points in early morning trading.
“We’re staying underweight on the mining sector, but we’re not excessively pessimistic on that sector either,” said Brown Shipley chief investment officer Peter Botham.
“The Chinese rate of growth will be reduced, but China will still be moving ahead.”
Botham said the FTSE 100 would continue to rise this year and would eventually break through the 7,000 point level which would mark a record high for the index, although he felt overall returns for investors would be lower in 2014 than 2013.
“This year will be one of steady progress, but I’d be amazed if we get the same returns this year as last year.”
Markus Huber, senior sales trader at Peregrine & Black, also felt the FTSE would hit the 7,000 level in the first half of this year, and added that the start of 2014 could soon see fresh money come back into the UK stock market.