UPDATE 2-Glencore tumble weighs on FTSE 100; BoE sees longer recovery period

Reuters

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    * BoE now sees recovery to pre-pandemic levels by end-2021
    * Glencore scraps dividend, books $3.2 billion charge
    * Aviva surges on plan to reduce Asia, Europe focus 
    * FTSE 100 down 1.3%, FTSE 250 off 0.9%

 (Updates to market close)
    By Sagarika Jaisinghani and Susan Mathew
    Aug 6 (Reuters) - London-listed shares broke a three-day
winning run on Thursday as commodities giant Glencore tumbled
after scrapping its dividend to pay down debt, while the Bank of
England forecast a slower-than-expected rebound from the
COVID-19 pandemic.
    Glencore  GLEN.L  dropped 8.1% as it also booked a $3.2
billion impairment charge, driving the FTSE 100  .FTSE  down
1.3%.  urn:newsml:reuters.com:*:nL8N2F81VS
    With the pound  GBP=  stronger, London shares in miners BHP
 BHPB.L , Rio Tinto  RIO.L  fell after solid gains on Tuesday,
as did oil majors BP  BP.L  and Royal Dutch Shell  RDSa.L .
 GBP/ 
    The BoE said the British economy would not recover to its
pre-pandemic size until the end of next year - later than its
earlier estimate, but its projections for 2020 were less grim
than in May. There was no immediate case to cut rates below
zero, it added.  urn:newsml:reuters.com:*:nL8N2F81TQ urn:newsml:reuters.com:*:nL8N2F820M
    But, "there is little incentive to rule out negative rates
right now and we expect the market to stay very invested in this
debate well into 2021," said strategists at ING.
    "In choosing to keep the bank rate and the asset purchasing
program target unchanged, the BoE still has the door open for
further policy action – probably at the November meeting."
    Despite a stimulus-led rally since April, the FTSE 100 is
still down about 20% this year with surging COVID-19 cases
raising the spectre of further lockdowns. This compares to a 3%
rise for the S&P 500  .SPX  with a U.S. fiscal aid package eyed.
 .N 
    British Housing Secretary Robert Jenrick said new housing
starts could be down as much as 40% this year even with the
industry showing signs of recovery.  urn:newsml:reuters.com:*:nS8N2ES00Q  urn:newsml:reuters.com:*:nL8N2F75SP
    Homebuilders Taylor Wimpey  TW.L , Barratt Developments
 BDEV.L  and Persimmon  PSN.L  lost between 3.7% and 4.3%.
    At the other end, insurer Aviva's  AV.L  shares shot up 4.6%
as analysts cheered its decision to reduce focus on Asia and
Europe after reporting a 12% drop in first-half operating
profit.  urn:newsml:reuters.com:*:nL8N2F8201
    The mid-cap FTSE 250  .FTMC  was down 0.9%, with industrial
and financial stocks among the biggest drags.

 (Reporting by Sagarika Jaisinghani in Bengaluru; Editing by
Subhranshu Sahu and Lisa Shumaker)
 ((Sagarika.Jaisinghani@thomsonreuters.com; within U.S. +1 646
223 8780; outside U.S. +91 80 6182 2256;))
 
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