Bloomberg Anywhere Remote Login Bloomberg Terminal Demo Request


Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.


Financial Products

Enterprise Products


Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000


Industry Products

Media Services

Follow Us

U.K. Stocks Decline Amid Concern European Economy Will Weaken

U.K. stocks declined, erasing last week’s gains on the benchmark FTSE 100 Index, amid concern that the new leaders in Italy and Greece may not be able to push through the measures required to stem the debt crisis.

Majestic Wine Plc, which owns the U.K.’s largest chain of wine warehouses, fell to its lowest in seven months after saying its October sales were worse than expected. Schroders Plc lost 2.2 percent. Smith & Nephew Plc rallied 2.6 percent after Exane BNP Paribas advised buying the shares.

The FTSE 100 declined 26.34, or 0.5 percent, to 5,519.04 at the close in London. The gauge added 0.3 percent last week as Italy’s Senate approved debt-reduction measures and Greece named a new national-unity government. The FTSE All-Share Index dropped 0.4 percent, while Ireland’s ISEQ Index rose 0.1 percent today.

The new administrations in Italy and Greece “are likely to be short-lived and may lack the legitimacy to push through reforms,” Dan Morris, a global strategist at JPMorgan Asset Management, wrote in a report. “With elections expected some time over the next six months, there will be ongoing doubt about the ability of the governments to pass and implement austerity and growth packages.”

New Regime in Italy

Mario Monti, a former European Union competition commissioner, was named Italy’s new prime minister, boosting confidence in the country’s ability to cut the euro area’s second-biggest debt. Silvio Berlusconi resigned after defections ended his parliamentary majority and the country’s 10-year bond yield surged over the 7 percent threshold that prompted Greece, Ireland and Portugal to seek EU bailouts.

Italian bonds today fell for the first time in three days after the nation paid the highest yield since June 1997 at a debt sale, highlighting the challenge facing the new government to win over investors.

Bonds declined even as the European Central Bank was said to buy the securities today, according to two people familiar with the transactions who declined to be identified because the deals are confidential.

Spanish government securities also slid as ECB Governing Council member Jens Weidmann suggested the central bank should end its support of the region’s most indebted nations.

“The concern instead is that growth will continue to weaken and even more countries risk falling back into recession,” JPMorgan’s Morris wrote in his report. “The danger of a euro zone breakup is low.”

Greek Priority

In Greece, Finance Minister Evangelos Venizelos said his priority is to ensure the country gets a sixth loan under an EU-led bailout after Prime Minister Lucas Papademos took charge of a new interim government.

Majestic Wine fell 3.9 percent to 400 pence, its lowest price since April, after saying its October sales were worse than expected. Revenue in stores open at least a year declined 1.1 percent in the six weeks ended Nov. 7 on “disappointing” two weeks in mid-October, the company said in a statement today.

Schroders slid 2.2 percent to 1,362 pence.

Highland Gold Mining Ltd. declined 5.7 percent to 181 pence after the company reduced its production guidance for gold this year.

Premier Foods Plc slumped 11 percent to 5.74 pence after UBS AG downgraded the shares to “sell” from “neutral.”

Smith & Nephew climbed 2.6 percent to 572.5 pence after Exane BNP Paribas upgraded the stock to “outperform” from “neutral.”

Purecircle Ltd. rallied 17 percent to 112 pence after getting regulatory approval for the use of steviol glycosides in foods and beverages in Europe.

Gulf Keystone Petroleum Ltd. climbed 1.6 percent to 180 pence and Petroceltic International Plc rose 8.8 percent to 8.16 pence, leading gains among oil explorers operating in Kurdistan, after the region’s government was said to agree on drilling contracts with Iraq’s central authorities.

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.