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Iraq worries push UK's FTSE down

London - Britain's top equity index slid on Friday to a near four-month low, as worries about conflict in northern Iraq intensified after US President Barack Obama authorised air strikes against Islamist militants.

Obama said on Thursday he had authorised the air strikes to blunt the onslaught of Islamist militants in northern Iraq and began air drops of supplies to besieged religious minorities to prevent a “potential act of genocide.”

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

The development added to worries about conflict in Ukraine, where Kiev's forces have clashed with pro-Russian separatists, and elsewhere in the Middle East that have knocked back global stock markets over the last month.

The blue-chip FTSE 100 index was down by 1 percent, or 63.70 points, at 6,533.67 points - close to its lowest level since mid-April. The FTSE 100 is down by 2.3 percent since the start of 2014.

“The selling pressure just has not abated at all. At every corner, it seems that something else comes out of the woodwork that gives people another reason to sell,” said Hantec Markets analyst Richard Perry.

Perry said the FTSE could find buyers coming in if it fell down to the 6,500 point level, which marked earlier lows this year around March and April, after which the index recovered.

Central Markets trading analyst Joe Neighbour said the FTSE could fall to 6,425 points if it failed to hold above 6,500 points.

Neighbour said while the uncertainty over possible US military action in Iraq persisted, he would advise investors to look to sell the FTSE on any rallies for a profit, rather than use days when the FTSE fell to buy up shares. - Reuters

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