U.K. Stocks Decline; Biggest Weekly Loss in More Than Two Years
U.K. stocks fell for a sixth day as the FTSE 100 Index (UKX) recorded its biggest weekly loss in almost three years, even after a report showed the U.S. added more jobs than expected last month.
The FTSE 100 dropped 146.15 points, or 2.7 percent, to 5,246.99 at the 4:30 p.m. close in London, bringing the decline for the week to 9.8 percent, the most since November 2008 and its longest streak of losses since March. Better-than-expected U.S. job figures failed to assuage concern over the strength of the global economic recovery. The FTSE All-Share Index dropped 2.7 percent, while Ireland’s ISEQ Index declined 1.5 percent.
“Its fair to say we’ve seen panic in the last few days,” said David Jones, chief market strategist at IG Index in London. “It’s been catastrophic and it looks like we’re in for more of the same next week. People are seeing no reason to buy.”
The Labor Department’s monthly payrolls report showed U.S. employers added 117,000 workers in July, beating the median estimate in a Bloomberg News survey. The jobless rate dropped to 9.1 percent.
The Standard & Poor’s 500 Index declined the most since February 2009 yesterday, while the MSCI Asia Pacific Index tumbled 3.7 percent, its biggest drop since March. More than $4.5 trillion has been wiped off the value of equities worldwide since July 26.
BP, Europe’s second-largest oil company, fell 2.3 percent to 410.65 pence after it began talks with Transocean Ltd. over the 2010 Gulf of Mexico oil spill. Transocean Chief Executive Officer Steven Newman reiterated yesterday that BP is liable for all costs and fines.
Royal Dutch Shell slid 3.9 percent to 1,925 pence, a sixth day of losses.
Royal Bank of Scotland Group Plc (RBS) led a retreat of banking stocks. Britain’s biggest government controlled bank plunged 6.9 percent to 28.18 pence after posting a wider-than-estimated first-half loss of 1.4 billion pounds ($2.3 billion). The bank also said it will cut about 2,000 jobs in the next 18 months.
Lloyds Banking Group Plc (LLOY) slumped 6.1 percent to 32.85 pence. HSBC Holdings Plc (HSBA), Europe’s largest bank by market value, dropped 3.7 percent to 557.1 pence. Barclays Plc (BARC), the U.K.’s second-largest bank by assets, slid 5.1 percent to 186 pence.
Logica Plc (LOG), an Anglo-Dutch computer-services provider, plunged 14 percent to 88.55 pence after posting first-half pretax profit of 75 million pounds, down from 86 million pounds a year earlier.
Glencore, the world’s largest listed commodity trader, soared 4.5 percent to 408.4 pence, snapping eight days of losses, its longest streak since May.
Inmarsat Plc (ISAT), the London-based satellite-services provider, rallied 2.1 percent to 402.7 pence, rebounding from yesterday’s record 19 percent slump.
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