U.K. stocks retreated for a third day to a 10-week low as banks and insurers fell amid continuing concern that Europe’s sovereign debt crisis is worsening.
Barclays Plc, Royal Bank of Scotland Group Plc and Resolution Plc tumbled more than 2 percent as credit-default swaps on European bank bonds surged to the highest level since April 2009.
The benchmark FTSE 100 Index dropped 0.4 percent to 5,528.27 at the 4:30 p.m. close in London. The gauge has fallen 2.6 percent in November, the biggest monthly drop since June. The broader FTSE All-Share Index lost 0.5 percent today while Ireland’s ISEQ Index slid 0.4 percent.
“Investors remain in the clutches of edgy sentiment with concerns over Europe remaining at the fore,” said Giles Watts, head of equities at City Index in London. “Providing substance to the fears is the continued pressure on the euro.”
The euro fell to 10-week lows versus the dollar and the yen today as investors shunned riskier assets. The FTSE 100 has dropped 2.5 percent over the past two days after a bailout of Ireland at the weekend failed to reassure investors that the debt crisis will be contained.
Barclays, the U.K.’s third-biggest lender, dropped 2.6 percent to 256.15 pence and RBS retreated 2.4 percent to 37.59 pence, sending a gauge of banks to the lowest level since July.
Resolution, Standard Life
Resolution, an insurance buyout firm, fell 3.8 percent to 211.3 pence, while Standard Life Plc, Scotland’s second-biggest insurer, lost 3.7 percent to 201.2 pence.
The Markit iTraxx Financial Index of swaps on junior debt of banks and insurers soared as much as 25.5 basis points to 320, according to JPMorgan Chase & Co. Swaps on Italy, Spain, Portugal and Ireland jumped to records, driving Europe’s benchmark index of government debt risk to an all-time high.
The following stocks also rose or fell in the U.K. and or Irish markets. Stock symbols are in parentheses.
Essar Energy Plc (ESSR LN) gained 4.1 percent to 522 pence, the best performer in the FTSE 100. The Indian power generator and refiner will join the MSCI United Kingdom Index after the close of trading today. Joining an index can boost a company’s stock price because funds that mirror it buy shares of the members.
Findel Plc (FDL LN) jumped 6.5 percent to 12.25 pence after the U.K. home-shopping and educational-supplies company said talks aimed at refinancing the balance sheet were at an “advanced stage.”
Holidaybreak Plc (HBR LN) rallied 7.4 percent to 290 pence after the travel company said full-year profit soared to 20.2 million pounds ($31.4 million) as more customers took educational and adventure trips.
Halma Plc (HLMA LN) slid 4.7 percent to 313.6 pence. Numis Securities lowered its recommendation for the shares to “hold” from “add” after the world’s second-biggest maker of smoke detectors reported first-half results.
RPC Group Plc (RPC LN) jumped 3 percent to 288.25 pence after the U.K. maker of plastic containers said first-half net income rose 64 percent to 13.1 million pounds.
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