By Sudip Kar-Gupta
LONDON (Reuters) – Britain’s top equity index fell for the 10th time in 11 sessions on Tuesday, as weaker energy shares and a fall in chip designer ARM weighed on the market.
Energy shares dropped after oil major BP posted lower profits, and similarly weak results from ARM reinforced concerns among some investors that corporate results will not be strong enough to prevent a pullback in equities in the first quarter.
The blue-chip FTSE 100 index was down by 0.4 percent, or 23.74 points, at 6,441.92 points in mid-session trading – close to its lowest level since mid-December.
A 3.9 percent fall in ARM and a 1.6 percent drop at BP together took the most points off the FTSE 100, and BP’s fall also pushed the FTSE 350 Oil & Gas Index down to its lowest level since mid-October.
The energy sector has come under pressure on signs of slowing growth in the United States and China, the world’s top oil consumers, with data this week showing a sharp slowdown in U.S. manufacturing in January.
“It is definitely a risk-off attitude dominating the markets right now, sparked by the macro data showing that the two biggest economies in the world are losing momentum,” said Varengold Bank trader Anita Paluch.
The FTSE rose 14.4 percent in 2013 to post its best annual gain since 2009, but the index has fallen by nearly 5 percent at the start of 2014 on concerns over the situation in China and the United States, while a slump in emerging markets has also knocked back global equities.
“I am expecting a further pull-back of at least 3 percent over the next two weeks before we start to find new support and cash,” said H20 Markets chief market strategist Mike Jarman.
(Additional reporting by Atul Prakash; Editing by Catherine Evans)
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