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27 Jan 2021 | 14:17

FTSE 100 movers: Fresnillo loses its shine;

(Sharecast News) - London's FTSE 100 was down 1.8% at 6,533.08 in afternoon trade on Wednesday. Precious metals miner Fresnillo lost its shine after it lowered its current-year gold output forecast as a landslip at its Noche Buena mine and Covid restrictions hit 2020 production. The company, which operates seven mines in Mexico, reported a 12.1% fall in 2020 gold production to 769,618 ounces, at the upper end of revised estimates provided in October.

Miners were weaker generally, with Anglo American and Glencore also in the red.

Education publisher Pearson was the top gainer on the index, with traders pointing to a short squeeze.

CMC Markets analyst David Madden said: "There is no new news about the publishing company but it is known that a relatively large amount of the stock has been shorted, so it is possible that we are witnessing a major short squeeze.

"Recently, the US group GameStop, has undergone erratic moves as there is a tussle between short sellers and buyers. It might be the case that funds are flowing into Pearson to shake out some of the short sellers."

Neil Wilson, chief market analyst at, said: "It is likely down to short covering as hedge funds back out of their positions in light of what has happened to heavily shorted stocks like GME.

"This is very much about managing risk. Given the situation across the pond vis-à-vis Merlin, I would think all hedge funds are taking a good hard look at all their short positions and deciding whether they are worth it. Shorting can result in potentially infinite losses, so the risk management is always against you if the flows are there from buyers. As a result of the short covering, or rather in anticipation of it, some traders (maybe some on Reddit, who knows?) may be front-running and contributing to the pump."

FTSE 100 - Risers

Pearson (PSON) 850.40p 11.69% Hargreaves Lansdown (HL.) 1,774.00p 5.47% British Land Company (BLND) 460.30p 4.33% St James's Place (STJ) 1,210.50p 2.45% British American Tobacco (BATS) 2,787.00p 1.96% Standard Life Aberdeen (SLA) 313.30p 1.72% BAE Systems (BA.) 477.40p 1.55% Morrison (Wm) Supermarkets (MRW) 187.10p 1.41% Land Securities Group (LAND) 629.70p 1.24% Pennon Group (PNN) 979.40p 1.20%

FTSE 100 - Fallers

Fresnillo (FRES) 940.00p -11.53% Aveva Group (AVV) 3,674.00p -5.77% Entain (ENT) 1,202.00p -5.61% Anglo American (AAL) 2,371.50p -5.54% Glencore (GLEN) 242.90p -4.75% Mondi (MNDI) 1,728.00p -4.53% Imperial Brands (IMB) 1,555.00p -4.34% Coca-Cola HBC AG (CDI) (CCH) 2,159.00p -4.13% NATWEST GROUP PLC ORD 100P (NWG) 147.25p -4.04% Evraz (EVR) 495.50p -4.01%

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