London, England -- (SBWIRE) -- 08/19/2010 -- Joshua Raymond, Market Strategist, City Index commented:

“The heavyweight banks and miners were the main drags on the FTSE 100 on Wednesday, with the miners reversing yesterday’s gains forcing the UK Index lower by 0.5% in early trade.

For the best part of a month or so now equities have been simply trading through the motions. The FTSE 100 has been locked in a 200 point trading range and I get the feeling that until the heavier trading volumes come back into the market, investors are happy to simply be range trading at this point.

A lot of the individual stock moves we have seen has been based on some of the more interesting news stories out there but I do get the feeling that there are a lot of investors on holiday right now.

The miners have had 2 days of decent gains and so much of the selling we have seen so far has been an excuse to take some profits off the table.

ENRC is the heaviest faller in the session after the Kazak miner posted a 63% rise in first half EPS but noted that there are evident areas of weakness in price outlook.

This has stirred investors into selling part of their holdings today, forcing its hares lower by 2%.

The move by BHP Billiton to turn their bid for Potash Corp hostile has not induced any significant amount of selling. For now some it seems are interested to see how this one will pan out, whilst others may be seeing value in the acquisition itself that is keeping them from selling its shares.

Sterling strengthens after BoE minutes
We did see investors move to buy into the pound sterling on the back of the BoE minutes. There were a few murmurs here and there that there may have been a renegade committee member voting to expand QE given recent economic data. Seeing that the committee was unanimous in maintaining QE at £200bn has poured water on these murmurs and encouraged some sterling buying as a bit of a knee jerk reaction.

In truth, what the minutes show is that the MPC are firmly sitting on the fence, discussing the options but not giving weight to any change in policy just yet, be it movement on rates or QE.”

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