MARKET REPORT: Gold miner loses a third of its value after arrests

Australian gold miner Resolute Mining lost around a third of its value yesterday after three employees, including its chief executive, were detained in Mali.

The company’s London-listed shares plunged 35.7 percent, or 12.3 pence, to 22.2 pence in the biggest one-day sell-off since October 2008, during the depths of the financial crisis. .

Chief Terence Holohan and two other executives were in Bamako, the capital of the West African nation, for talks with local mining and tax authorities when they were “unexpectedly detained” on Friday, Resolute said.

Malian authorities also arrested four Barrick Gold employees in September, underscoring growing tensions between the military-led regime and international miners.

Mali is one of Africa’s biggest gold producers and the government is seeking to channel a greater proportion of the revenue into state coffers.

Resolute owns 80 percent of its gold mine in Syama and the government owns the remaining 20 percent.

“Resolute has followed all official processes regarding its affairs and has provided authorities with detailed responses to all claims made,” a spokesperson for the gold miner said.

The FTSE 100 returned to the lead after four days of losses, rising 0.7 per cent, or 52.8 pence, to 8,125.19 and the FTSE 250 gained 1 per cent, or 205.61 points, up to 20,723.53.

It was a topsy-turvy session for Burberry. Shares in the luxury fashion brand rose about 5 percent in early trading on continued speculation that Italian ski jacket maker Moncler is willing to make a bid.

But they closed down 3.3 per cent, or 26.8 pence, at 778 pence after Moncler insisted it was not in talks.

European defense stocks rose as pressure mounts on governments to increase military spending following Donald Trump’s victory in the US presidential election.

In London, Rolls-Royce added 3.4 percent, or 18.8 pence, to 572 pence and BAE Systems rose 1.2 percent, or 16 pence, to 1,393.5 pence. Meanwhile, SAAB advanced 3.8 percent in Stockholm and Leonardo gained 4.3 percent in Milan.

Shares in chemicals company Croda rose 5.2 per cent, or 189 pence, to 3,793 pence after it reported a 5 per cent rise in third-quarter sales to £407 million.

It said it was on track to make profits of between £260m and £280m for the year.

Software provider Kainos soared 6.2 per cent, or 49p, to 844p after posting an 11 per cent rise in first-half profits to £34.2m, despite a fall of 5 percent on revenues to £183.1 million.

Customer review website Trustpilot rose 4.9 per cent, or 12.5p, to 269.5p after analysts at Deutsche Bank began covering the stock with a “buy” rating. Trustpilot shares are up 94 percent so far this year.

Fuel cell technology developer Ceres Power rose 4.5 per cent, or 7.7 pence, to 180 pence after analysts at Jefferies raised its rating from “hold” to “buy” and raised the price target of the stock at 265p from 190p.

Oil and gas engineer Wood made further gains after shares plunged 60 per cent on Thursday as he began a review of contracts in his books and accounts.

It gained 16 per cent on Friday and 6.4 per cent yesterday, closing up 3.7p at 61.55p. Analysts at Morgan Stanley cut their price target on the stock to 85p from 185p.