U.K. Stocks Litte Changed as Housebuilders Slide on BOE

U.K. stocks were little changed, with the FTSE 100 Index (UKX) heading for its first monthly loss since August, as housebuilders slid after the Bank of England ended incentives that helped stimulate mortgage lending.

Persimmon Plc (PSN) slumped 6.1 percent after the central bank said its Funding for Lending Scheme will only apply to business lending from 2014. Rio Tinto Group rose 3.9 percent after agreeing to increase iron-ore output capacity. Thomas Cook Group Plc (TCG) rallied to its highest price since January 2011 after the tour operator posted a 49 percent jump in full-year earnings.

The FTSE 100 Index climbed 5 points, or 0.1 percent, to 6,654.47 at the close of trading in London, after earlier gaining as much as 0.5 percent. The gauge has dropped 1.1 percent in November. The equity benchmark has still rallied 13 percent this year as central banks around the world pledged to keep interest rates low for a prolonged period to support the economic recovery. The FTSE All-Share Index also added 0.1 percent today, while Ireland’s ISEQ Index increased 0.6 percent.

“Markets will continue to crawl higher slowly amid continued positive sentiment,” Peter Buergler, a trader at Luzerner Kantonalbank AG in Lucerne, Switzerland, said in a e-mail. “Volumes are very low today, due to the Thanksgiving holiday in the U.S. Volumes are likely to stay rather low, even after the U.S. holiday, except for some window dressing toward the end of the year.”

The number of shares changing hands in companies listed on the FTSE 100 was 22 percent lower than the average of the past 30 days, data compiled by Bloomberg showed. U.S. equity markets are closed today for the Thanksgiving holiday.

Housebuilders Plunge

Persimmon, the U.K.’s largest housebuilder, sank 6.1 percent to 1,170 pence after BOE Governor Mark Carney changed the Funding for Lending Scheme and removed banks’ ability to hold no capital against mortgages granted under the FLS. Barratt Developments Plc (BDEV) lost 4.9 percent to 329.9 pence and Bovis Homes Group Plc (BVS) slid 5.5 percent to 777 pence.

Kingfisher Plc (KGF), which generates half of its earnings from France, retreated 4.4 percent to 378.6 pence as the company gave a glum outlook for the business climate in France and reported U.K. sales that missed estimates.

“Our markets remain challenging, especially in France, where consumer confidence is still weak with no obvious signs of an imminent improvement,” Chief Executive Officer Ian Cheshire said in a statement.

Imperial Tobacco Group Plc (IMT) and British American Tobacco Plc (BATS) slipped 1.9 percent to 2,316 pence and 0.7 percent to 3,250.5 pence, respectively, as Jane Ellison, a health minister, told BBC Radio 4’s Today Programme that the government considers introducing plain packaging for cigarettes.

Rio Tinto

Rio Tinto climbed 3.9 percent to 3,261 pence. The world’s second-biggest miner said it will spend $3 billion less than previously expected to meet its goal of increasing iron-ore output capacity to 360 million metric tons. Annual production capacity will climb from 290 million tons at the end of June next year, the company said in a statement.

A gauge of European mining companies posted the best performance on the Stoxx Europe 600 Index. Anglo American Plc and Glencore Xstrata Plc gained 2.7 percent to 1,375 pence and 1.7 percent to 312.3 pence, respectively.

Thomas Cook jumped 15 percent to 175.7 pence. Full-year underlying earnings before interest and taxes climbed to 263 million pounds from 177 million pounds a year earlier.

Kentz Corp. gained 2.5 percent to 594.5 pence as Acquisitions Daily reported that M+W Group GmbH is considering a new bid for the oil-engineering company.

The European Commission in Brussels confirmed that consumer confidence in the 17-nation euro area declined in November. An index of household confidence compiled by the European Union’s executive arm fell to minus 15.4 from minus 14.5 in October, matching economists’ projections.

To contact the reporter on this story: Corinne Gretler in Zurich at cgretler1@bloomberg.net

To contact the editor responsible for this story: Cecile Vannucci at cvannucci1@bloomberg.net

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