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FTSE falls as sanctions threat reignites Turkey sell-off

Lira resumes slide after US threatens Turkey with more sanctions if jailed church minister is not released.

FTSE falls as sanctions threat reignites Turkey sell-off
 

Turkey's battered lira currency has resumed its slump as the US ramped up threats against the country over the fate of imprisoned church minister Andrew Brunson.

The lira fell 3.7% against the dollar, snapping a recovery from lows since Tuesday, as the US warned it would hit Turkey with more sanctions if Brunson is not released. The lira is down 38% against the dollar since the turn of the year, as Turkey's economic problems have worsened.

'We have more that we are planning to do if they don't release him quickly,' said US treasury secretary Steven Mnuchin. The US last week doubled import tariffs on Turkish steel and aluminium.

The news weighed on the FTSE 100, which after a positive start to the day's trading reversed into the red, down 18 points, or 0.2%, at 7,538.

House builders were the day's big fallers. Taylor Wimpey (TW) fell 2.3% to 166.4p, Persimmon (PSN) was down 2.2% at £24.15 and Barratt Developments (BDEV) dropped 2.1% to 526p.

Miners resumed their slide at the end of a punishing week. Antofagasta (ANTO) fell 2.2% to 825.2p, Randgold Resources (RRS) was down 2% at £49.34 and Anglo American (AAL) lost 1.7% to trade at £15.16.

On the FTSE 250, Kaz Minerals (KAZ) slumped 12.3% to 491.6p as analysts at Barclays, UBS and Credit Suisse all cut their price targets on the copper miner.

'Mid-cap' house builder stocks meanwhile joined their blue-chip peers in the red.  Bellway (BWY) fell 2.5% to £28.05, Galliford Try (GFRD) was down 1.7% at 929p and Redrow (RDW) dropped 1.2% to 525.5p.

Among small-cap stocks, fresh turmoil in Turkey knocked shares in DP Eurasia (DPEU), a franchisee of Domino's Pizza which generates 68% of its sales in the country. The stock fell 3.6% to 87.6p.

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