"Commodity-linked stocks are acting like a weight around the neck of the FTSE 100 this morning, with last week's sharp declines for the likes of gold and silver continuing apace today. Weakness for the precious metal names such as Fresnillo and Endeavour mining have been accompanied by declines for the likes of Antofagasta, Glencore, and Anglo American as we see prices for the industrial metals also head lower."
"The price action seen over the course of the past 3 trading days has been nothing short of historic, with the nomination of Kevin Warsh as the next Fed chair sending shockwaves throughout markets. Understandably, this appears to mark the end of easy money, with the repeated desire to shrink the Fed balance sheet and avoid constant monetary intervention meaning that markets could lose a key factor which has helped deliver the stable and consistent 10% average S&P 500 return."
Commodity-linked stocks are dragging the FTSE 100 as gold, silver and industrial metals decline alongside oil. Precious-metal miners such as Fresnillo and Endeavour Mining, and industrial names like Antofagasta, Glencore and Anglo American, have fallen. Oil prices weakened after concerns of a potential weekend attack on Iran failed to materialize. Weaker commodity prices reduce inflation pressures and counter the worries prompted by a 0.5% PPI reading on Friday. Recent market moves were amplified by Kevin Warsh's nomination as Fed chair, signalling an end to easy money. Markets weigh a more hawkish Fed against political pressure that could force rate cuts.
Read at London Business News | Londonlovesbusiness.com
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