U.K. stocks were little changed, with the FTSE 100 Index near an eight-month high, as declining commodity producers offset gains in Unilever, which reported quarterly sales growth that beat analysts’ forecasts.
Commodity producers fell, led by Kazakhmys Plc and Rio Tinto Group, which lost at least 3 percent each. Unilever advanced 1.8 percent as it posted an 8.4 percent increase in emerging-market sales. Standard Chartered Plc climbed 2.3 percent after a report that analysts see the bank as a takeover target. SDL Plc rallied 10 percent as the lower end of its full-year sales forecast beat analysts’ projections.
The FTSE 100 lost 2.47 points, less than 0.1 percent, to 6,834.26 at the close of trading in London. The benchmark gauge reached its highest level since May 22 yesterday, and has gained 1.5 percent so far this year as the World Bank raised its global-growth forecasts. The FTSE All-Share Index fell 0.1 percent today, while Ireland’s ISEQ Index increased 0.2 percent.
“We started the year with huge amount of supportive sentiment but what’s different from 2013 is valuations,” Simon Pryke, who helps oversee $71 billion at Newton Investment Management in London, said by phone. “We’ve had a huge move in markets which hasn’t been matched by a change in earnings forecasts. The environment looks pretty unstable and our feeling is that that is likely to support a bit of volatility, certainly in years ahead.”
The FTSE 100 climbed 14 percent in 2013, pushing its valuation at the end of the year to 14.1 times estimated earnings. That compares with a three-year average of 11.1 times projected profit, data compiled by Bloomberg show.
A gauge of London-listed mining companies fell 2 percent. Kazakhmys Plc, Kazakhstan’s largest copper miner, retreated 4.9 percent to 185.5 pence. Rio Tinto Group, the world’s second-biggest commodity producer, lost 3.1 percent to 3,231.5 pence. Antofagasta Plc, which owns copper mines in Chile, dropped 3 percent to 819.5 pence and Anglo American Plc, the world’s largest platinum producer, slipped 2.7 percent to 1,356 pence.
Unilever climbed 1.8 percent to 2,480 pence after saying fourth-quarter sales excluding acquisitions and currency fluctuations rose 4.1 percent. That exceeded the 3.9 percent increase estimated by analysts in a Bloomberg survey.
“The results from Unilever confirmed that double-digit growth from emerging markets may be a thing of the past, but that high single-digit growth is still a pretty positive attribute to hold,” said Guy Foster, the London-based head of portfolio strategy at Brewin Dolphin Ltd., which oversees 28 billion pounds ($46 billion).
Standard Chartered gained 2.3 percent to 1,358 pence. The Financial Times cited unnamed investment bankers as saying the lender is the “most likely target of a big banking takeover.”
SDL surged 10 percent to 373 pence as the maker of translation software forecast full-year revenue of 265.8 million pounds to 266.3 million pounds. The average estimate of analysts surveyed by Bloomberg is for 263.3 million pounds.
African Barrick Gold Plc climbed 2.9 percent to 206.5 pence after saying annual production beat the upper end of its forecast. Gold output rose 2.5 percent in 2013 to 641,931 ounces, the first annual increase since it was spun off from Barrick Gold Corp. in 2010. The London-listed Tanzanian producer had projected output of 540,000 ounces to 600,000 ounces.