U.K. stocks fell the most in almost three weeks as mining shares dropped and companies from Unilever to SABMiller Plc posted sales that missed estimates.
BHP Billiton Ltd. and Rio Tinto Group slid at least 1.5 percent as copper fell for the first time in six days. Unilever retreated 1.6 percent and SABMiller lost 2.5 percent. ARM Holdings Plc tumbled the most in more than a month after Sanford C. Bernstein & Co. said its valuation may drop in the second half. Rolls-Royce Holdings Plc climbed to its highest price in more than two decades after profit jumped 34 percent.
The FTSE 100 Index lost 32.48 points, or 0.5 percent, to 6,587.95 at the close in London, the biggest drop since July 5. The benchmark gauge has still rallied 12 percent this year as central banks around the world pledged to continue stimulus measures. The broader FTSE All-Share Index also slid 0.5 percent today, while Ireland’s ISEQ Index rose 0.1 percent.
“To a large extent, U.K. earnings echo the macroeconomic news,” said Guy Foster, London-based head of portfolio strategy at Brewin Dolphin Securities Ltd., which oversees about $39 billion. “Guidance has generally been that developed-market growth is tepid, while developing markets are not going to provide the growth that they have in recent years. Unilever is a good example of that.”
The volume of shares changing hands in FTSE 100 companies today was 23 percent lower than the 30-day average, data compiled by Bloomberg show.
The U.K.’s gross domestic product rose 0.6 percent in the second quarter, the Office for National Statistics said. That matched economists’ forecast in a Bloomberg survey and marked the first back-to-back quarterly growth since September 2011.
A gauge of London-listed mining companies slipped 2 percent. Copper fell as Goldman Sachs Group Inc. said a global surplus may almost double in two years. A preliminary private purchasing managers’ survey yesterday showed Chinese manufacturing shrank more than forecast in July.
BHP, the world’s biggest mining company, dropped 1.5 percent to 1,878 pence and Rio Tinto, the second-largest, lost 1.9 percent to 2,915 pence. Anglo American Plc slid 3.4 percent to 1,389 pence.
“There is just a total absence of meaningful good news for the mining sector,” Foster said. “After the woeful China PMI yesterday, mining-sector investors seem to be in the mood to cut losses by selling into any strength.”
Unilever slipped 1.6 percent to 2,676 pence after the world’s second-biggest consumer-goods maker said so-called underlying revenue rose 5 percent in the second quarter, trailing the average analyst forecast for a 5.3 percent gain.
“Growth is slowing in emerging markets, as macroeconomic headwinds influence consumer behavior,” the company said.
SABMiller declined 2.5 percent to 3,160 pence, the biggest drop in a month, as the world’s second-biggest brewer said the volume of lager sold in the first quarter fell 1 percent, excluding acquisitions and disposals. That missed the average analyst estimate calling for a 2 percent increase.
ARM lost 3.3 percent to 859 pence, the largest decline since June 21, as Bernstein said it expects a drop in the chip designer’s royalty revenues in the fourth quarter and a slowdown in smartphone sales. The brokerage kept an underperform rating.
Capita Plc slid 3.9 percent to 996.5 pence, the biggest drop in 15 months, after the supplier of services to the British government reported a first-half operating-profit margin of 12.5 percent, down from 13.3 percent a year earlier. The full-year figure will be in the range of 12.5 percent to 13.5 percent for the “foreseeable future,” the company said.
Rolls-Royce advanced 5.1 percent to 1,240 pence, the highest since at least 1988, as the world’s second-biggest maker of commercial-aircraft engines said first-half pretax profit excluding some items rose to 840 million pounds ($1.28 billion). That beat the 828.8 million-pound average forecast by analysts in a Bloomberg survey.
Shire Plc climbed 5.5 percent to 2,339 pence, the highest since it sold shares to the public in 1996. The world’s biggest maker of drugs for attention deficit disorder reported second-quarter earnings excluding some items of $1.79 per American depositary share, exceeding analysts’ projection for $1.64.
Reed Elsevier Plc gained 4.2 percent to 834.5 pence, the highest level since at least 1988, after the owner of the LexisNexis database said it will spend 600 million pounds on share buybacks this year. First-half operating profit, excluding acquisitions, disposals and one-time items, rose 7 percent to 592 million pounds, according to a statement.