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U.K.’s FTSE 100 Index Fluctuates Near a Five-Year High

U.K. stocks swung between gains and losses after the benchmark FTSE 100 (UKX) Index last week rallied to its highest level in more than five years.

Barclays fell with European banks after Fitch Ratings downgraded Italy. Sage Group Plc dropped the most in more than three weeks after Bank of America Corp. lowered its rating on the software publisher. SABMiller Plc (SAB) led advancing shares, rising for a ninth consecutive day.

The FTSE 100 rose 0.2 percent to 6,498.37 at 12:49 p.m. in London after swinging between gains and losses more than 10 times today. The gauge climbed to its highest level since December 2007 last week as economic data from U.S. payrolls to Chinese exports bolstered optimism in the the global recovery.

The broader FTSE All-Share Index also increased 0.2 percent, while Ireland’s ISEQ Index (ISEQ) advanced 0.9 percent. The volume of shares changing hands in companies on the FTSE 100 was 15 percent lower than the 30-day average, according to data compiled by Bloomberg.

Fitch cut Italy’s credit rating by one level after the close of European markets on March 8, sending bond yields higher in Italy. The downgrade comes before European Union leaders meet for a summit on March 14-15 to discuss the terms of a bailout for Cyprus.

Barclays, RBS

Barclays fell 2.4 percent to 311 pence, paring last week’s 5 percent rally. Royal Bank of Scotland Group Plc (RBS) slid 2.4 percent to 299 pence and Lloyds Banking Group Plc (LLOY) retreated 1.5 percent to 49.3 pence.

Sage Group (SGE) lost 3.2 percent to 338.4 pence. Bank of America downgraded the shares to underperform, the equivalent of a sell rating, and added the company to the list of its least-preferred technology stocks. Analyst Chandramouli Sriraman cited Sage’s slow development of cloud-based applications and said that the company’s valuation has probably peaked.

Carnival Plc declined 1.6 percent to 2,488 pence after rival Royal Caribbean Cruises Ltd. said 105 passengers and three members of crew on one of its cruise ships became ill with a stomach bug thought to be the norovirus.

SABMiller climbed 1.8 percent to 3,467 pence. The world’s second-biggest brewer has surged 23 percent so far this year, while rival Diageo Plc (DGE) has gained 12 percent.

Diageo, Soco

Diageo said a reorganization at its supply and procurement operation will lead to savings of 60 million pounds ($89.3 million) a year within three years. The stock gained 0.6 percent to 2,005 pence.

Soco International Plc (SIA) added 1.7 percent to 383.4 pence after the oil explorer said it plans to increase pumping capacity at its fields off the coast of Vietnam by about 27 percent, allowing it to pay an annual dividend to shareholders from this year.

Ladbrokes Plc (LAD) surged 7.6 percent to 242.2 pence after the gambling operator expanded its software partnership with Playtech Ltd. (PTEC) The two companies will develop more games for Ladbrokes.com. Playtech rose 3.2 percent to 569 pence.

In Ireland, Elan Corp. climbed 5.7 percent to 9.10 euros. The drugmaker announced after the close of trading on March 8 that it plans to buy back $1 billion in shares at $11.25 to $13 apiece. Volume was about 37 percent of the stock’s three-month average, data compiled by Bloomberg shows.

To contact the reporter on this story: Sarah Jones in London at sjones35@bloomberg.net

To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net

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