London’s top shares fall as South Africa, Japan hurt sentiment

London’s top shares fell to a three-week low as a deterioration in South Africa’s politics and the prospect of a fourth emergency rate hike in Japan weighed on sentiment.

The FTSE 100 closed 29.15 points lower, down 0.5 percent at 7,382.13 – its lowest closing level since Oct. 13.

The FTSE 250 index fell 119.07 points to 18,169.17, a four-month low.

Following the FTSE 100, Barclays fell 3.55 percent, Lloyds 2.96 percent, Royal Bank of Scotland 1.85 percent and Royal Dutch Shell 0.41 percent.

Miners were among the top performers on the FTSE, with Glencore rising 4.73 percent and Rio Tinto up 3.21 percent. Anglo American climbed 4.22 percent and BHP Billiton advanced 3.01 percent.

The falls came after South Africa’s ruling African National Congress endorsed the ANC’s chief whip, Jackson Mthembu, as its candidate for president, fuelling concerns over the future stability of a country already shaken by an anti-government plot and anti-Semitic comments.

The rand fell 1.4 percent to 13.9050 per dollar.

South Africa’s business confidence index fell for a fifth consecutive month in October, according to Markit, after the ANC last month appointed Mthembu as its candidate for president.

The FTSE 100 closed on Thursday at 7,458.63 points, its lowest since April 22.

Elsewhere in Europe, Germany’s DAX index fell 0.4 percent to 12,276.57 and France’s CAC 40 slid 0.7 percent to 5,244.07.

Mining stocks and banks were the main drag on the DAX as investors locked in profits from a rally that pushed the German market to levels not seen since before Britain voted to leave the European Union in June 2016.

Shares of Volkswagen fell 3.41 percent and Deutsche Bank fell 3.13 percent.

In Paris, Philips fell 2.97 percent. The European medical equipment supplier reported third-quarter profits fell 15 percent as it tightened its operating margin by two percentage points to 12.3 percent.

The Bank of Japan raised its short-term interest rate target, less than many economists had expected, and signaled that the central bank still stands ready to act if growth fails to pick up and inflation stays too low.

However, after two weeks of a steep stock sell-off, precious metals producers and energy stocks rebounded, with gold and oil stocks as investors sought a safe haven from risk.

The dollar was off one percent against a basket of major currencies at 91.440, extending falls from last week, its worst week since April 2016.

The Japanese yen was down 0.6 percent at 113.06 to the dollar.

In other commodities markets, Brent crude oil slipped 0.37 percent to $55.51 a barrel after rebounding from the lowest level in two months.

Spot gold rose 0.2 percent to $1,318.25 an ounce.

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