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London Markets: Mining stocks under pressure in London as industrial metals buckle

Stocks struggled in London on Tuesday, with mining companies dragging the main index south and tracking weak metals prices. Shares of JD Sports Fashion surged after a record first half.

The FTSE 100 index
UKX,
-0.38%

was flat at 7,061.57, while the pound
GBPUSD,
+0.27%

rose nearly 0.5% to $1.3907 as the U.S. dollar
DXY,
-0.17%

slumped following slightly softer-than-expected consumer prices.

The biggest moves for London came for mining companies. Shares of heavily weighted Rio Tinto
RIO,
-1.38%

RIO,
-1.78%

fell 1%, BHP Group
BHP,
-2.19%

BHP,
-1.96%

slid 1.2% and Anglo American
AAL,
-2.93%

shares fell 1.7%.

The losses came as December palladium futures
PAZ21,
-6.07%

slumped 4.6% to $1,983.50 an ounce. The industrial metal is used largely to make catalytic converters in gasoline-powered vehicles to help keep emissions down. The metal is also used for the photovoltaic sector and electric vehicle market, and has also seen gains on hopes for growth in that area. Copper prices
HGU21,
-1.21%

slipped 1% to $4.32 a pound and platinum prices
PLV21,
-2.65%

fell 2.5% to $933.30 an ounce.

“The chip shortage and the resulting fall in production in the automotive industry are apparently having an impact on the palladium price. After all, this is bound to reduce demand for palladium,” said Commerzbank analyst Daniel Briesemann, in a note to clients.

Elsewhere, the retail sector was active, with shares of JD Sports Fashion
JD,
+8.25%

surging 9% as the FTSE 100’s best gainer, after the sports-goods retailer said first-half profits rose to record-high levels, and that it expects to achieve a headline pretax profit of at least 750 million pounds ($1.04 billion) for 2021 overall. JD Sports also owns U.S.-based sports retailer The Finish Line, after an acquisition in 2018.

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