Anglo American overtakes Glencore to become FTSE's worst performer

Anglo American has overtaken its rival Glencore to become the FTSE 100’s worst performer so far this year, a day after it announced a radical restructuring plan as it battles the collapse in commodity prices.

Shares in Anglo American have nose dived 76.5pc since January, compared with Switzerland-based Glencore, which is currently nursing a loss of 74.65pc across the same period.

However, as the market began to digest its plans to overhaul the business, the FTSE 100 stock fell a further 13pc this morning.

Investors continued to pile out of the stock as brokers issued a slew of bearish notes and slashed its target price.

Myles Allsop, of UBS, cautioned Anglo’s “material restructuring” is not enough to ease balance sheet concerns.

Describing the restructuring plans as “ambitious”, the investment bank thinks prices for Anglo’s key commodities will remain subdued over the next few year, with iron ore and copper set to move into oversupply and coal already oversupplied. It also believes there is some potential for a recovery in diamonds and platinum.

Meanwhile, Nick Hatch, a Canaccord Genuity analyst, said Anglo’s challenge “remains substantial”, despite its heightened urgency to deliver on its restructuring plans.

“When commodity prices do recover, the share price recovery could be significant, but in the meantime investors should remain wary,” Mr Hatch said.

• Anglo American must dig deeper to get out of its hole

Shares in Glencore came under severe pressure on September 28 when they plunged by almost 30pc after broker Investec warned the stock could be worthless if the dramatic fall in commodity prices continued. The commodities trader and producer has already cancelled its dividend and taken measures to tackle its debt pile. It will update investors on its plans tomorrow.

An accelerating rout in commodity prices has hammered the industry this year and put the sector under significant pressure to slash capital expenditure and operational costs.

On Tuesday, Iron ore slipped below the $40 a barrel mark for the first time since the spot price was introduced in 2008. The sharp fall in commodities prompted a mass sell-off across the sector, sending the FTSE 350 mining index tumbling to its lowest level in eleven years.

BHP Billiton and Antofagasta are also among the top fallers on Britain’s benchmark index so far this year, down 44.8pc and 43.8pc, respectively.

Top 10 FTSE 100 fallers this year:

1. Anglo American (-76.5pc)
2. Glencore (-74.65pc)
3. BHP Billiton (-44.83pc)
4. Standard Chartered (-44.63pc)
5. Antofagasta (-43.77pc)
6. Pearson (-37.98pc)
7. Rio Tinto (-37.37pc)
8. Rolls-Royce (-32.76pc)
9. Weir Group (-32.74pc)
10. Royal Dutch Shell (-32.74)