LONDON: Britain's top share index hit a three-week low on Monday, with Intercontinental Hotels Group falling after saying it was not considering a potential sale or merger move and miners tracking weaker metals prices.
The blue-chip FTSE 100 index was down 0.6 percent at 6,316.30 points by 1603 GMT after falling earlier in the session to 6,306.68 points, the lowest level since mid-October. The index is down more than 3 percent so far this year.
Intercontinental Hotels Group shares fell 4.4 percent after the hotelier denied a media report. On Friday, IHG shares had jumped more than 6 percent following the report saying it was looking at its strategic options.
The UK mining index fell 1.5 percent, the top sectoral decliner, as copper prices slid towards their lowest level in six years after the dollar firmed on prospects of an interest rate rise in the United States and trade data from top consumer China underlined struggling growth.
The market also came under pressure after some utility and property firms, which generally offer attractive yields, slipped on concerns of a rate hike.
"Property companies such as Intu and utilities like Severn Trent are sinking since higher rates will increase the cost of purchasing a mortgage and the cost of servicing high levels of corporate debt will rise," CMC Markets analyst Jasper Lawler said.
The rate hike concerns were boosted by Friday's stronger-than-expected U.S. jobs data, with shares in Intu Properties, Taylor Wimpey and Barratt Developments falling 1.0 to 2.7 percent. Utilities such as Severn Trent, United Utilities Group and Centrica declined 2.4 to 3.5 percent.
Centrica was also hurt by a note from HSBC, which downgraded its rating for the company to "hold" from "buy" and lowered its target price for the stock to 250 pence from 300 pence to reflect lower commodity and power prices.
However, financial companies, which generally perform well when rates rise, outperformed the wider market. Aberdeen Asset Management, Standard Chartered, Barclays and HSBC were up between 0.3 and 1.9 percent.
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