The FTSE 100 closed 0.2% lower at 10,806.89 points by 1008 GMT on Thursday, marking its fourth straight day of decline and touching its lowest level since July 28. According to Reuters, the blue-chip index fell to a more than two-week low as mining sector losses offset any relief from stronger-than-expected economic growth data. The sustained decline reflects continued investor concerns about commodity-related sectors amid fluctuating energy prices and industrial production challenges. By mid-morning Thursday, the index had dropped 54 points to 10,778, though it remained comfortably above earlier session lows. The mood is described as one of waiting rather than worrying, with traders taking a cautious approach ahead of key US economic data.
Mining stocks experienced severe losses after Antofagasta delivered a 5% share price decline following its downbeat copper production forecast. As reported by City AM, the company cut its 2026 copper output forecast due to a shutdown at its Los Pelambres mine in July. The company now expects to produce 625,000 to 655,000 tonnes of copper in 2026, against earlier guidance of 650,000 to 700,000 tonnes. The mining sector contagion spread to other major players, with Rio Tinto shares falling more than 4%, Fresnillo dropping 3%, Endeavour Mining losing 2.71% at 4,176p and Anglo American slipping 2.59% to 3,953.5p. Russ Mould, AJ Bell's investment director, noted that "miners were in retreat in London after Antofagasta's latest update saw a material downgrade to its production outlook – a sharp reminder of the operational setbacks which are a fact of life in the mining sector." The selling follows an unusually strong stretch for the sector, with copper reaching record levels on the London Metal Exchange last week above $14,200 a tonne.
UK GDP data revealed 0.4% quarter-on-quarter growth in Q2, in line with expectations but slightly below the 0.6% recorded in Q1. According to Reuters, this represents a positive surprise against the 0% forecast, with companies enjoying a respite from the energy price surge caused by the Iran war, the start of the men's soccer World Cup and hot weather. The June reading showed an unexpected 0.3% expansion, a positive surprise compared with the 0% forecast, with May's reading also revised lower to show no growth, following a contraction in April. Manufacturing managed 1.0% growth, largely thanks to a 4.2% jump in pharmaceuticals, but utilities went backwards and dragged production to a standstill. Construction eked out 0.3% growth and remains 2.0% smaller than a year ago, reflecting the state of the sector. For the Bank of England, a resilient economy with a 2.9% GDP deflator does not exactly scream urgency on rate cuts.
Oil prices have cooled slightly this morning despite yesterday's warning from the global energy watchdog that oil stockpiles were "rapidly depleting". According to City AM, this development provides some relief to the commodity-heavy sectors that have been under pressure. The cooling in oil prices, combined with the latest economic data showing 0.4% GDP growth, suggests that supply concerns may not be as immediate as previously feared. However, Treasury officials have briefed the Prime Minister that the UK economy will barely grow next year if disruption to the Strait of Hormuz linked to the Iran war continues until the end of 2026. This ongoing geopolitical risk continues to weigh on market sentiment, particularly affecting energy-related sectors.
The FTSE 100 continues to trade above its multi-month rising trend line and above both the 200 and 50 EMAs, maintaining a constructive broader trend. As reported by Investing.com India, the index has encountered resistance at the record high of 10,990 and retreated towards 10,800. A rise back above 10,990 would bring fresh record highs into focus, with 11,000 and 11,200 as the next logical targets. However, momentum is fading, so buyers will need to see the index regain strength before attempting a move higher. Immediate support is positioned around 10,750, with a break below this level exposing the 50 EMA at 10,650 and the rising trend line around 10,600. Below 10,600, attention turns towards 10,450, the July low, which would create a lower low and change the chart structure.
