By Carla Mozee, MarketWatch
LONDON (MarketWatch) -- U.K. stocks edged higher Wednesday,
slightly recovering from its worst session in about five months,
but the benchmark FTSE 100 still lagged a rally in the broader
European equity market.
The FTSE 100 was up 0.1% at 6,709.95, with luxury goods maker
Burberry Group PLC and Royal Mail PLC among the best performers as
shares rose 2.1% and 3.2%, respectively.
But the blue-chip index's gain was limited by losses for mining
shares following a slower-than-expected industrial-output growth in
China
(http://www.marketwatch.com/story/china-jan-feb-industrial-output-growth-slows-2015-03-11),
a major commodities buyer. Precious metal producer Fresnillo PLC
struggled at the bottom of the blue-chip benchmark, losing 1.3%.
Copper Antofagasta PLC fell 0.9%, adding to Tuesday's 5.5% drop,
and iron ore miner Glencore PLC declined 1.1%.
Mining and energy stocks led Tuesday's selloff that left the
FTSE 100 down by 2.5%, its sharpest fall since mid-October.
The Stoxx Europe 600 on Tuesday also dropped, but rallied
Wednesday
(http://www.marketwatch.com/story/european-stocks-rally-as-weaker-euro-fuels-exporters-2015-03-11)as
euro weakness bolstered exporters, and as European Central Bank
President Mario Draghi touted what he says has been an effective
start of the bank's quantitative easing program. The Stoxx 600 was
up 0.9%, and Germany's DAX 30 (DAX) barreled toward a record high
as it jumped 1.9%
The "FTSE 100 continues to massively underperform the DAX ... it
hasn't got the QE behind it that the DAX has" and the lack of
energy plays on the DAX cushions the index when oil prices are
driven lower, in contrast with the FTSE 100, said Richard Perry,
market analyst at Hantec Markets.
Perry said the FTSE 100 appears "on the brink of a possible
correction ... with the first initial support around the 6,650
area."
It was just late last month that the FTSE 100 reached its best
closing high, finally surpassing the previous closing high set in
December 1999.
Meanwhile, the pound (GBPUSD) fell $1.4960 from $1.5070 late
Tuesday. The pound slightly edged back after data showed U.K.
manufacturing output in January fell 0.5%, falling short of
expectations of a 0.2% increase. But much of the pressure has been
the result of a rally in the dollar (DXY) against major rivals as
the U.S. Federal Reserve appears set to begin raising interest
rates this year.
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