Sector movers: Soft Chinese data weighs on miners, oil service stocks lower

Soft data out of China's manufacturing sector weighed on the price of copper, sparking further selling across the mining sector.

Caixin's manufacturing sector purchasing managers' index fell from a reading of 51.2 for March to 50.3 in April, its lowest level since last September, versus economists' forecasts calling for a reading of 51.3.

Commenting on the PMI data, Dr. Zhengsheng Zhong, Director of Macroeconomic Analysis at CEBM Group said: "The downward pressure on manufacturing gradually emerged in April, with all indicators weakening. The Chinese economy may be starting to embrace a downward trend in the near term as prices of industrial products decline and active restocking comes to an end."

Tuesday's figures come on the heels of the sharp rise in short-term interest rates in the Asian giant, as Beijing cracks down on so-called 'shadow banking' activities, which market observers say has been weighing on commodity prices, including for iron ore.

They also followed a similarly weak result for other data on China released over the weekend, including the 'official' non-manufacturing or services PMI which retreated from 55.1 for March to 54.0 in April, a six-month low.

Three-month LME copper ended the day at $5,802 per metric tonne, marginally higher than the 28 April close of $5,801 but off their intra-day high of $5,820.

Out on Comex on the other hand July 2017 copper futures were erasing 1.01% to $2.6335 a pound.

Shares in Vedanta, Anglo American and BHP Billiton were especially hard hit.

Oilfield service and equipment names were lower amid downbeat 'market chatter' regarding the outlook for the sector outside of US shale, with the offshore space still not seeing a recovery in demand, according to market pundits.

Dampening sentiment further, front month Brent crude oil futures were off by 0.82% to $51.10 a barrel on the ICE after Baker Hughes reported on 28 April that the US oil rig count rose by a further nine last week to 697.

Top performing sectors so far today

Construction & Materials 7,076.85 +1.92%
Forestry & Paper 21,952.03 +1.85%
General Industrials 5,958.40 +1.81%
Aerospace and Defence 5,177.44 +1.73%
Insurance (non-life) 2,947.39 +1.68%

Bottom performing sectors so far today
Industrial Metals & Mining 2,272.00 -1.75%
Mining 14,685.86 -1.36%
Automobiles & Parts 8,300.13 -1.09%
Fixed Line Telecommunications 3,501.17 -0.74%
Oil Equipment, Services & Distribution 15,482.28 -0.55%