The FTSE 100 closed sharply lower on Thursday, dragged down by a broad sell-off in mining stocks and several heavyweight constituents trading ex-dividend.
The blue-chip index ended the session down 60.48 points, or 0.6%, closing at 10,772.67, underperforming its European counterparts in Paris and Frankfurt.
Antofagasta (ANTO.L) led the fallers on the index, dropping 6.8% after releasing half-year results that showed earnings ahead of expectations but debt levels higher than anticipated.
The Chilean copper miner also cut its full-year production outlook after severe weather disrupted operations at its Los Pelambres mine, which was temporarily shut down due to exceptional adverse weather conditions.
Antofagasta now expects copper output for the full year 2026 in the range of 625,000 to 655,000 tonnes, reduced from its previous guidance of 650,000 to 700,000 tonnes.
Rio Tinto (RIO.L) fell 4.8% and Fresnillo dropped 4.7%, both trading ex-dividend, while a weaker gold price compounded pressure across the sector, with the yellow metal trading at 4,369.95 dollars an ounce, down from 4,422.11 dollars on Wednesday.
BP (BP.L) fell 1.6% and Shell (SHEL.L) dropped 1.0%, both trading ex-dividend and further pressured by a lower oil price, with Brent crude for October delivery slipping to 87.87 dollars a barrel from 88.88 dollars late Wednesday.
Despite the equity market weakness, UK economic data offered a more encouraging picture, with gross domestic product growing 0.4% quarter-on-quarter in the three months to June 30, ahead of the Bank of England’s forecast of 0.3%.
Deutsche Bank UK chief economist Sanjay Raja struck an upbeat tone following the figures, noting that “after a thumping start to the year,” the second-quarter release takes the annualised growth rate in the first half to a “scorching” 2%.
Raja added: “And for a second straight quarter, it looks like the UK will take top place in the G7 league table,” suggesting forecasters will be forced to revisit annual growth estimates toward 1.1%.
June’s monthly GDP reading of 0.3% confounded expectations for a 0.1% decline, providing a positive end to the quarter after the economy was flat in May and contracted 0.1% in April.
In the US, producer price index inflation slowed more than anticipated in July, adding to hopes that interest rates will not be raised, though analysts at Oxford Economics noted that services prices rose more strongly beneath the headline numbers.
Oxford Economics still expects the headline personal consumption expenditures price index to cool to 3.6% year-on-year in July from 3.7% in June, with core PCE inflation steady at 3.3% on-year.
Lower bond yields provided a boost to London-listed housebuilders, with Persimmon rising 2.2% and Barratt Redrow climbing 2.4% as the interest rate outlook improved.
Aviva advanced 1.7% ahead of its half-year results due on Friday, boosted further by a JPMorgan upgrade to “overweight” from “neutral” with a raised price target of 800 pence, up from 715 pence.
JPMorgan analyst Farooq Hanif believes Aviva offers stronger cash generation and capital returns than peers, with a more capital-light earnings mix underpinning the positive outlook.
On the FTSE 250, Savills surged 11% after the real estate services provider reported that half-year underlying pre-tax profit jumped 47% and revenue rose 8.4%.
Gaming operator Rank climbed 6.0% after reporting increased underlying earnings and a higher dividend, with the company saying all its businesses had shown growth “for a fifth consecutive year, reflecting the return on capital investments and strong growth in gaming machine performance across the group.”
The FTSE 250 ended up 22.83 points, or 0.1%, at 24,837.71, while Europe’s CAC 40 closed down 0.3% and the DAX 40 ended down 0.1%, leaving the FTSE 100 as the notable laggard among major indices.
Investors will be watching closely on Friday for eurozone GDP figures, US retail sales data, the Michigan consumer sentiment index, and half-year results from insurer Aviva.