Investors are selling mining stocks today - and bad news is expected on retail sales later.
The financial markets are enduring another torrid day, as investor gloom spreads over the UK's economic prospects.
Mining stocks suffered big losses on the FTSE 100 this morning, as news filtered through of Australian firm Rio Tinto's plans to sell part of the business to China. Yesterday's extremely downbeat Bank of England inflation report - which forecast a three percent GDP decline for the UK economy in 2009 - also weighed down strocks.
As of 13:38 GMT, the FTSE was 4188.48 points, or 1.08 percent, down on the day. Sterling was also struggling, declining 0.94 percent against the dollar and 0.66 percent against the euro.
Joshua Raymond, market strategist at City Index commented: "The FTSE has shown some considerable fight over the last two trading days and has been bouncing off its lows. This gives the market hope that we could recover the ground lost earlier in the week."
The strategist added that investor eyes would be on new US retail sales data, scheduled for release this afternoon. The key indicator of consumer demand in the world's largest economy "might send investors running for the hills" if declines were worse than expected, he said.
