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Gold miners lead FTSE 100 lower | Gold miners lead FTSE 100 lower |
(about 3 hours later) | |
Shares in gold mining companies led the London market lower as the rising value of the dollar hit the gold price. | |
Randgold Resources fell 6.5% while gold and silver miner Fresnillo dropped 5.8% as the gold price slid 1% to $1,203.86 an ounce, the lowest since May. | |
Commodities are generally priced in dollars, so a rise in the dollar's value makes them more expensive for holders of other currencies. | |
The dollar has risen on expectations that US rates will rise next month. | |
On Thursday, the chair of the Federal Reserve, Janet Yellen, indicated that the US central bank could raise interest rates "relatively soon". | On Thursday, the chair of the Federal Reserve, Janet Yellen, indicated that the US central bank could raise interest rates "relatively soon". |
By midday, the benchmark FTSE 100 share index was down 32.92 points at 6,761.79. | |
In the FTSE 250, shares in Electrocomponents surged 17% after the electronic component distributor reported a 76% jump in half-year profits to £55.1m, and raised its target for cost savings. | |
On the bond markets, yields on UK 10-year gilts hit a six-month high of 1.498% at one point before falling back. | |
Global bond yields - which move inversely to bond prices - have surged since Donald Trump's US election victory, as markets expect his policies to lead to a pick-up in inflation. | |
On the currency markets, the pound was little changed against the dollar at $1.2413, and also flat against the euro at €1.1688. |