UKX FTSE 100 Index

By Emily Horton

ASOS shares sink 40%

Retail gloom hit London markets on Monday, after online retailing giant ASOS PLC cut its full-year outlook, sending its rivals into the red.

Mining companies led the heavy-weight gainers.

How are markets trading?

The U.K.'s FTSE 100 declined 0.8% to 6,790.16 after finishing up 1% last week.

   The pound   was up against the dollar at $1.2618 on Monday, from $1.2583 late Friday in New York. 

What is driving the markets?

Shares of U.K. fashion retailers slid after ASOS (ASC.LN) warned of difficult November trading (http://www.marketwatch.com/story/asos-profit-warning-sends-shares-of-rivals-lower-2018-12-17-44852948) and cut its full-year outlook. Shares of ASOS, which list on London's Alternative Investment Market of smaller companies, plummeted by 40% after the profit warning, helping send the shares of its rivals into the red.

Investors also looked to Wall Street, where stocks were weaker after a meltdown on Friday. Attention will zero in this week on the U.S. Federal Open Market Committee policy meeting on Wednesday, where investors are expecting another interest-rate hike, but hoping for a dovish message (http://www.marketwatch.com/story/the-feds-about-to-embark-on-a-tricky-balancing-act-with-a-rate-hike-and-a-dovish-message-2018-12-13).

The Bank of England will also hold its own policy meeting on Thursday, but isn't expected to announce any changes to interest rates given the uncertainty surrounding Brexit. U.K. Prime Minister Theresa May is reportedly pushing back on the idea of a second referendum over Brexit, as she fights to keep her exit deal alive.

Mining stocks may be all ears for China's annual Central Economic Work Conference that starts Tuesday. The government will set out policy direction and could announce stimulus for an economy that has shown signs of sagging (http://www.marketwatch.com/story/chinas-slower-growth-in-november-spooks-emerging-markets-undermining-risk-sentiment-2018-12-14).

Read:Chinese stocks have outperformed S&P 500 since trade truce (http://www.marketwatch.com/story/chinese-stocks-have-outperformed-sp-500-since-trade-truce-2018-12-17)

What stocks are active?

On the heels of a slump for ASOS, shares in its major competitors also felt the heat. Boohoo Group PLC (BOO.LN) dropped by 13% and Quiz PLC (QUIZ.LN) slumped 20%. While Marks and Spencer Group PLC (MKS.LN) and Next PLC (NXT.LN) fell 5% and 6%, respectively.

Mining heavy-weights were among the biggest gainers on Monday, with BHP Group PLC (BHP.LN) up 3% after announcing it purchased 5% of its stock in a $5.2 billion buyback (http://www.marketwatch.com/story/bhp-buys-back-52-billion-in-stock-2018-12-16), funded by the sale of its U.S. shale unit. Glencore PLC (GLEN.LN) was up just under 2%, Rio Tinto PLC (RIO.LN) gained almost 2% and Anglo America PLC (AAL.LN) jumped 1%.

(END) Dow Jones Newswires

December 17, 2018 09:40 ET (14:40 GMT)

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