FTSE 100 movers: Precious metals miners slump; BP gains on refinery sale

(Sharecast News) - London's FTSE 100 was a sea of red in afternoon trade on Thursday, with the index down 2.4% at 10,056.94. NatWest, M&G, Standard Chartered and Melrose all slumped as they traded without entitlement to the dividend.

Precious metals miner Fresnillo and gold miner Endeavour fell as gold and silver prices retreated.

Chris Beauchamp, chief market analyst at IG, said: "Precious metals are supposed to be havens in time of surging inflation, but just as in 2022, this old cliché is proving to be dreadfully incorrect. Instead investors have done what they always do, buy the dollar, and both gold and silver have dropped accordingly. When under pressure, the liquidity available in the dollar and US Treasuries is far more attractive than any notional inflation hedge in precious metals."

Miners were also under the cosh amid weaker metals prices, with Antofagasta, Rio Tinto and Anglo American all sharply lower.

BP was a rare bright spot after the oil giant said it had sold its Gelsenkirchen refinery and related businesses to independent European refiner Klesch Group for an undisclosed sum, saving around $1bn in operating expenditure.

Dan Coatsworth, head of markets at AJ Bell, said: "The recent surge in energy markets has swung the pendulum back in favour of BP, but the company isn't resting on its laurels as it continues to execute on its disposal plan.

"Higher oil and gas prices should improve the financial position of BP and potentially enable it to pay down debt at a faster rate. But selling off parts of the business, with the aim of also reducing costs, remains part of the picture too.

"The price tag on the sale of its Gelsenkirchen refinery to European outfit Klesch is under wraps but regardless of this figure, the resulting boost to BP's cost savings target is arguably more significant.

"With the higher oil and gas price backdrop and progress on reshaping and streamlining the business, the stars are aligning for incoming CEO Meg O'Neill as she prepares to start next month.

"Investors will be watching closely to see what O'Neill has up her sleeves to build on the progress which has immediately preceded her taking over the top job."