U.K. Stocks Decline a Second Day as Marks & Spencer Falls
U.K. stocks declined for a second day as investors monitored the start of the earnings-reporting season for American companies and negotiations over how to avoid a default by the U.S. government.
Marks & Spencer Group Plc (MKS) dropped 3.1 percent as a gauge of retail sales grew at a slower-than-expected rate in September. ITV Plc (ITV) rose for a fourth day as Exane BNP Paribas recommended buying shares in Britain’s largest terrestrial broadcaster.
The FTSE 100 Index (UKX) retreated 22.59 points, or 0.4 percent, to 6,414.69 at 9:38 a.m. in London. The equity benchmark has decreased 3.2 percent from a Sept. 19 high as the U.S. government shut down and Italy’s government faced collapse. The broader FTSE All-Share Index slid 0.3 percent today, while Ireland’s ISEQ Index rose 0.1 percent.
“A lack of obvious progress regarding the U.S. budget continues to weigh on market participants’ sentiment,” Stephane Ekolo, chief European strategist at Market Securities in London, wrote in an e-mail.
President Barack Obama yesterday reiterated that he won’t negotiate with Republicans over conditions tied to the budget for the new financial year, which started on Oct. 1. He also said he will not discuss concessions to increase the country’s borrowing authority before it breaches the $16.7 trillion debt ceiling in nine days. Senate Majority Leader Harry Reid yesterday called for a House vote on a funding plan to reopen the government without setting preconditions.
The Treasury has said that it will exhaust measures to avoid exceeding the borrowing limit on Oct. 17. If that happens, the government would run out of cash to pay all of its bills at some point between Oct. 22 and Oct. 31, according to the Congressional Budget Office.
Alcoa Inc. will unofficially start the quarterly reporting season in the U.S. when it releases earnings after the close of European trading today. JPMorgan Chase & Co. and Wells Fargo & Co. both publish their financial results on Friday.
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