LONDON MARKETS: British American Tobacco Knocks FTSE 100 Lower

By Sara Sjolin, MarketWatch

LONDON (MarketWatch) -- The U.K.'s FTSE 100 moved cautiously lower on Wednesday, as investors digested minutes from the Bank of England and with shares of British American Tobacco PLC adding pressure after a lackluster trading update.

The benchmark index fell 0.2% to 6,361.82, after rallying 1.7% on Tuesday.

The Bank of England said seven of the nine members of its Monetary Policy Committee voted in favor of keeping rates at a record low at its October meeting, which was widely expected. The minutes also showed that the BOE officials expressed concerns about the U.K.'s economic prospects in October, citing increasing headwinds from overseas and a slowdown at home.

"With the near-term risks to growth and inflation on the downside, we now expect the BOE to remain [rates] on hold until June next year," said Rob Wood, chief U.K. economist at Berenberg, in a note.

Among stocks on the move in London, shares of British American Tobacco slumped 4% after the company reported a drop in nine-month revenue, hit by a slow economic recovery in Western Europe.

Mining firms were also dropping, tracking most metals lower. Shares of Fresnillo PLC dropped 1.1%, Rio Tinto PLC (RIO) fell 1.2% and Randgold Resources Ltd. lost 1.5%.

On a more upbeat note, shares of ARM Holdings PLC (ARMHY) climbed 0.8% after UBS lifted the chip maker to buy from neutral.

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