U.K. stocks were little changed, after the benchmark FTSE 100 Index yesterday reached its highest level since May, as gains by mining companies offset a decline in HSBC Holdings Plc.
Rio Tinto Group rose 2.5 percent after beating its cost-cutting targets for 2013 and increasing iron-ore production to a record. BHP Billiton Ltd. rose 3.8 percent as Citigroup Inc. recommended buying shares in the world’s biggest mining company. HSBC, Europe’s largest bank, slipped 1 percent.
The FTSE 100 lost 0.1 percent to 6,815.42 at the close in London. The benchmark gained 1.9 percent in the past four days as the U.S unemployment rate fell and the Basel Committee on Banking Supervision made concessions to lenders on a capital ratio. The broader FTSE All-Share Index also slipped 0.1 percent today, while Ireland’s ISEQ Index lost 0.3 percent.
“After the strong increase markets saw yesterday, investors are taking a breather,” said Benno Galliker, a trader at Luzerner Kantonalbank AG. “The market is characterized by the image of quarterly figures that are starting to come in. We’re seeing strong mining stocks based on Rio’s production figures. In general, the mood remains positive.”
The volume of shares changing hands in FTSE-100-listed companies was 26 percent greater than the average of the last 30 days, according to data compiled by Bloomberg.
In the U.S., a Labor Department report showed that applications for jobless benefits fell to 326,000 in the week ended Jan. 11 from a revised 329,000 in the preceeding week.
Rio Tinto added 2.5 percent to 3,334.5 pence as the world’s second-largest commodity producer said it reduced its cash costs by $2 billion last year. The company said fourth-quarter iron-ore production and shipments advanced to a record. Output climbed 7 percent to 55.5 million metric tons last quarter from 52 million tons a year earlier.
BHP Billiton rose 3.8 percent to 1,860 pence after Citigroup upgraded the shares to buy from neutral. The brokerage estimated that BHP Billiton can cut its costs by as much as $2.6 billion. It also predicted that the company will continue to sell assets in 2014.
A gauge of London-listed mining stocks rallied 3.2 percent, its largest advance since August. Anglo American Plc, which owns the world’s biggest platinum producer, added 4.9 percent to 1,397.5 pence, while Fresnillo Plc, which mines precious metals, gained 5.2 percent to 732.5 pence.
HSBC, which accounts for 7.2 percent of the FTSE 100, fell 1 percent to 673.9 pence for the largest drag on the index.
Premier Oil Plc plunged 6.5 percent to 288 pence, its biggest drop since August 2011. The oil explorer, which operates in Brazil and Vietnam, forecast production for this year that missed analysts’ estimates.
“Our output in 2014, after taking into account production efficiency and planned maintenance periods, is expected to be in the region of 58,000 to 63,000 barrels of oil equivalent a day,” the company said in a statement. Premier Oil has capacity to produce 75,000 barrels a day. The forecast fell short of an estimate by Sanford C. Bernstein & Co.’s Oswald Clint by about 10 percent.
Intertek Group Plc lost 3.4 percent to 2,879 pence, its biggest decline since July 2012. Berenberg Bank lowered its rating on the product-inspection company to hold from buy, saying that earnings per share will miss analysts’ estimates in 2014 if miners and oil producers reduce their capital spending. The brokerage added that demand for industrial-inspection services slowed toward the end of last year.