May 11 (Bloomberg) -- The U.K.'s benchmark stock index fell for a third day as the Bank of England trimmed its 2005 growth forecast. Antofagasta Plc, an owner of copper mines, dropped with the price of the metal.

BP Plc, Shell Transport & Trading Co. and GlaxoSmithKline Plc, three of the six biggest stocks in the FTSE 100 Index by weighting, all fell as they began trading without rights to their latest dividends.

The FTSE 100 fell 8.9, or 0.2 percent, to 4883.7 as of 13:46 p.m. in London. The FTSE All-Share Index also retreated 0.2 percent.

Benchmarks pared some of their losses after a government report showed the U.S. trade deficit unexpectedly narrowed in March.

The U.K. economy may expand around 2.6 percent this year, the Bank of England said today. In February, it forecast growth of 2.7 percent in 2005.

The central bank also said inflation will breach its 2 percent target this year, earlier than it had expected, before falling back in 2006, suggesting the bank is unlikely to move its benchmark interest rate any time soon.

Benchmarks rallied after a report in China's People's Daily, a Communist Party-owned newspaper, sparked speculation that China will relax its currency link with the dollar next week. The paper later removed the story from its Web site, and indexes resumed their decline. A Chinese central bank spokesman said he hasn't had notice of any change.

Antofagasta fell 38 pence, or 3.3 percent, to 1,117. Copper futures fell for the first day in three in London amid concern that demand is slowing at a time of rising supply.

Copper for delivery in three months on the London Metal Exchange fell 0.8 percent. The contract has fallen 4.3 percent from the record $3,338 a ton reached on April 12.

Separately, Antofagasta traded without the right to a 20.9 pence dividend.

Corus Group Plc, Britain's biggest steelmaker, lost 1.5 pence, or 3.4 percent, to 43 pence.

Crude Slips

BP, Europe's largest oil company, sank 7 pence, or 1.3 percent, to 539.5 as the shares traded without rights to a dividend payment of 4.45 pence per share.

Shell, owner of 40 percent of the region's No. 2 oil producer, decreased 7 pence, or 1.5 percent, to 470.5 as buyers of the shares lost eligibility for a payment of 4.45 pence apiece.

The oil stocks also slid as crude for June delivery fell as much as 1.3 percent to $51.40 a barrel in New York.

Glaxo, Europe's biggest drugmaker, slipped 8 pence, or 0.6 percent, to 1,327. Its most recent dividend payment is 10 pence a share. Rexam Plc, the world's largest beverage-can maker, also traded without the right to its latest dividend, declining 1.1 percent to 463 pence.

Somerfield, Morrison

Somerfield Plc, Britain's No. 5 supermarket operator, slipped 1 percent to 198 pence. Sales dropped at outlets open at least a year in the fiscal second half as competition among British food retailers intensified and customers spent less.

William Morrison Supermarkets Plc, Britain's fourth-biggest food retailer, fell 2.3 percent to 189.75 pence as Merrill Lynch & Co. said the company's Safeway business will remain unprofitable.

The following stocks are making gains or losses. Symbols are in parentheses after the company names.

Chrysalis Group (CHS LN), which owns London's Heart 106.2 FM radio station, fell 3 pence, or 2.1 percent, to 137 pence. Analyst Polly Elvin at UBS AG cut her share-price target to 158 pence from 188 pence.

Dixons Group Plc (DXNS LN), Britain's largest consumer- electronics retailer, added 3.4 percent to 146.25. Chief Executive John Clare said he doesn't expect analysts to change profit estimates, even as a slowdown in U.K. consumer spending and falling prices depresses business. The shares had dropped 5 percent in March and 7 percent in April.

Homestyle Group Plc (HME LN), which sells beds and furniture, dropped 7.1 percent to 59 pence. The company said it's looking into raising a ``significant'' amount of money. It didn't provide further details.

John David Group Plc (JD/ LN), the U.K.'s second-largest sporting-goods retailer, dropped 12.5 pence, or 5.4 percent, to 218.5 pence. The company's founders agreed to sell their stakes as part of an offer that values the business at 99.8 million pounds ($188 million). Pentland Group's Manchester Square Enterprises Ltd. is offering 211.2 pence a share for John David, 8.6 percent less than yesterday's closing price of 231 pence.

Sage Group PLC (SGE LN), Britain's biggest maker of accounting software, said fiscal first-half profit rose 4.5 pence, or 2.2 percent, to 206.5 pence. Ariel Bauer at ABN Amro raised Sage's share-price target to 230 pence from 215 pence.

Zoo Digital Group Plc (ZOO LN), a maker of video games, sank to its lowest in a year after the company said it's considering raising about 3 million pounds ($5.7 million) in a share sale. The shares lost 17 percent, or 2 pence, to 9.5 pence, the lowest since May 21, 2004.

The decline, the biggest since January 2004, takes this year's slide to 28 percent. Zoo Digital hasn't set a price for the sale.

To contact the reporter on this story: Sophie Hares in London at shares@bloomberg.net.

Last Updated: May 11, 2005 08:49 EDT