London’s top index was the worst performer among its biggest peers in Europe as a rising dollar put pressure on the capital’s miners.
The FTSE 100 ended the day down 31.52 points, coming off recent 16-month highs to close at 7,153.43.
The 0.4% drop put the index behind its European cousins which had also been hit by the Federal Reserve’s decision to bring forward its first interest rate rise after the pandemic.
The Dax in Germany rose 0.1%, while the Paris-based Cac closed up 0.2%, despite both being down earlier in the day.
“The FTSE 100 is the worst performer largely as a consequence of underperformance in the basic resource sector where a stronger US dollar is weighing on commodity prices, with falls in the likes of Fresnillo, Antofagasta and Anglo American, as gold and silver prices slide sharply,” said CMC Markets analyst Michael Hewson.
The Fed’s decision boosted the dollar to its highest point in a month against a basket of international currencies. Sterling lost 0.1% against its US rival, buying 1.3934 dollars, but gained 0.1% to buy 1.1691 euros.
But Mr Hewson said there were also some winners on Thursday.
“On the plus side the travel and leisure sector are having a welcome respite on Government plans to open up international travel for passengers who have been double jabbed in the expectation that more countries will open up routes for holiday destinations,” he said.
“As a result, easyJet, Ryanair as well as British Airways owner IAG are seeing good gains along with TUI, though it should be noted that we have been here before, and that vaccine passports remain a highly contentious topic.”
New York’s two biggest indexes were showing very different performances as traders in London prepared to go home. The S&P 500 was up 0.1% while the Dow Jones had fallen 0.6%.
The price of Brent crude oil fell 1.7% to $73.11 per barrel.
News out of Trainline and Halfords seemed to please investors. The ticket seller said that bookings had returned to pre-pandemic levels at the end of May, marking a turnaround for the hard-hit business. Shares rose by more than 5%.
Halfords saw its shares rise by a similar amount after reporting a 72% jump in annual pre-tax profits amid a surge in demand for bikes which has caused an “acute” global shortage.
EasyJet’s shares rose 2.8% despite criticism from environmentalists as it launched 12 new domestic routes in the UK.
Premier Inn owner Whitbread said that its hotels were nearly three-quarters full in the month to June 14, sending shares up 1.8%.
Dr Martens faced a nightmare day on the stock exchange, dipping 11.5% despite a 15% jump in sales in the 12 months to the end of March. Pre-tax profit had dipped 30% to £71 million in the period, due to the costs of listing the company in London this January.
The biggest risers on the FTSE 100 were BT, up 5.4p to 205.6p, Whitbread, up 63p to 3,353p, IAG, up 3.66p to 200.3p, Pershing Square, up 45p to 2,570p, and Rolls-Royce, up 1.92p to 111.92p.
The biggest fallers on the FTSE 100 were Halma, down 129p to 2,722p, Renishaw, down 220p to 5,330p, Glencore, down 11.45p to 305.6p, Anglo American, down 101p to 2,862.5p, and Fresnillo, down 28p to 805.2p.