FTSE 100 slips as geopolitics rattle nerves


It was another difficult day for blue chips with the events in Iraq and Ukraine weighing heavy.

The FTSE 100 was 22 points lower at 6,574 with all eyes again towards Wall Street to see how it responds to the promise of limited military action in Iraq by the US.

Best performers were those companies UK focused and with little exposure to Europe or the Middle East.

In that vein, Royal Bank of Scotland (LON:;RBS) was leading the FTSE 100 with a handy 3.1% gain followed by wealth manager Hargreaves Lansdown (LON:HL).

Mexican gold and silver miner Fresnillo (LON:FRES) got a double boost as the escalating global violence pushed up the prices of both metals as well as investors looked for safe havens.

Smiths (LON:SMIN), AB Foods (LON:ABF) and Reckitt Benckiser (LON;RB.) brought up the rear.

Away from Footsie, it was geopolitical events that dominated. 

Gulf Keystone (LON:GKP) endured a rollercoaster day as Islamic militants advance on northern Iraqi towns and cities.

US President Barack Obama says he has authorised air strikes on Islamic State (IS) fighters to prevent the slaughter of minorities.

IS has already seized Mosul which is just down the road from Kurdistan’s capital, Erbil, where Gulf Keystone is based.

Its flagship Shaikan oilfield, meanwhile, is just 85km to the north-west of Erbil.

Yesterday, the group admitted it had firmed up security around its operations, but insisted production and operations remain safe and secure.

“While there is no immediate threat to any of the company's operations in the region, we continue to monitor the situation closely and operate with increased security as a precaution,” it said in a statement, which helped the shares rally.

It was a similar story for Genel Energy (LON:GENL), the oil explorer run by former BP boss Tony Hayward.

Its shares fell 2% today to 803p, but there was after a rally following a statement declaring that the Taq Taq and Tawke fields are unaffected by the turbulence.

It was not so reassuring for Afren (LON:AFR), which has just suspended its chief executive and chief operating officer amid a probe into unauthorised payments.

 The oil group has suspended output at its Barda Rash oilfield in Kurdistan, the first field to shut in the region as Islamist militants move closer. Its shares fell 2% to 97.7p on Friday.

It was not just the mid-tier oil groups that were affected by the news however. 

News that drilling will start soon helped shares in Botswana Diamonds (LON:BOD) higher. The company confirmed a drill programme will kick off in the third week of September on its licence in Botswana. Shares rose 10% to 2.62p.

Solo Oil (LON:SOLO) was 10% at 0.37p as speculation builds over the Horse Hill well in Surrey.

African Potash (LON:AFPO) shares were down around 10% at 3.1p as it secured funding of up to US$3.75mln to drill its Lac Dinga potash project in the Republic of Congo.

The US$3.75mln is payable in four tranches and will provide working capital and support the project's growth.

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