FTSE back from near all-time highs

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FSTETrader1234 Reuters. A trader monitors the screen on a trading floor in London.

Edinburgh - Britain's blue-chip shares fell on Tuesday, led down by risk-sensitive stocks after failing to break through to all-time highs in the previous session.

Commodity-related stocks including oil firms and miners combined with financials to trim 15 points of the FTSE 100, which was down 22.50 points, or 0.3 percent, at 6,852.50.

Every sector was in negative territory after the index advanced 0.9 percent in the prior two sessions, and the fall was enough to erase all of Monday's gains.

The pullback kept the FTSE 100 in the 130 point range it has traded in since the beginning of May, at a time when other indexes including the S&P 500 and Germany's DAX have pushed on to new all time highs.

The FTSE 100 is 1.2 percent off its all-time high, set in December 1999.

Alastair McCaig, analyst at IG, said that while the index was less overbought than those in Germany and the United States, the FTSE 100 may struggle to hit new highs without a pullback in equities globally.

“We're positive on the improving economic landscape that we've seen for the UK, but the FTSE's performance has been a little bit more reserved than others,” he said.

“I'm a touch on the nervous side, however. Just to warrant the enthusiasm that we're seeing in equity markets, a natural correction is probably in order, then we can get back some of that momentum.”

Among top early fallers was Sports Direct, which dropped 1.8 percent in early deals.

The sports retailer suffered after Goldman Sachs removed it from its “conviction buy” list, citing its recent strong performance.

It is up 65 percent since last June, which still leaves 33 percent of upside to Goldman's target price of 1,100 pence.

“We remove Sports Direct from our Conviction List as the upside to our target price is now lower following a period of good performance,” analysts at Goldman Sachs write in a note.

“We have higher conviction elsewhere in the European retail sector as a result.” - Reuters

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