U.K. stocks slipped from their highest level in more than six weeks as drops in AstraZeneca Plc and HSBC Holdings Plc outweighed acquisition speculation.
AstraZeneca fell 2.3 percent after closing at a record yesterday. HSBC slid 1.7 percent as Morgan Stanley downgraded the lender. Tullow Oil Plc declined 2.5 percent after saying it abandoned a well off the coast of Mauritania. Tate & Lyle Plc rose the most since November 2011 amid reports that Bunge Ltd. may make an offer for the maker of Splenda sweetener.
The FTSE 100 Index lost 17.31 points, or 0.3 percent, to 6,685.69 at the close of trading in London, paring this week’s gain to 0.9 percent. The gauge is down 2.6 percent since reaching a 14-year high on Feb. 24 as tension between Russia and Ukraine escalated. The broader FTSE All-Share Index also fell 0.3 percent today. Ireland’s ISEQ Index slipped 0.9 percent for its longest weekly losing streak since June.
“There’s rotation between stocks, low momentum in the market, and a lack of confidence among fund managers,” said Tim Rees, who helps oversee $459 billion at Insight Investment Management Ltd. in London. “You have a lot of real or imagined M&A activity, which muddies everything. Should you be looking at fundamentals or trying to pick the winners in the lottery that is M&A? It’s just another level of uncertainty.”
The number of shares changing hands in FTSE 100-listed stocks today was 31 percent lower than the average of the past 30 days, data compiled by Bloomberg showed.
U.K. data showed retail sales excluding automobiles slipped 0.4 percent in March, following a revised 1.3 percent gain in February. Economists surveyed by Bloomberg had predicted a drop of 0.5 percent.
A U.S. report showed output from services industries expanded at a slower pace this month. Another report showed a final reading of consumer confidence rose in April to a nine-month high.
AstraZeneca fell 2.3 percent to 4,080 pence, wiping 4.7 points off the FTSE 100, after a five-day rally pushed it to the highest price since its May 1993 spinoff from Imperial Chemical Industries Plc.
HSBC fell 1.7 percent to 602.5 pence for the largest drag on the FTSE 100. Morgan Stanley cut its rating on the stock to underweight, similar to a sell, from equal weight, saying profit and sales for 2016 will be lower than analysts predict and the lender may pay a lower dividend in 2015.
Tullow Oil slipped 2.5 percent, its largest decline in six weeks, to 839.5 pence. The oil explorer said the well in offshore Mauritania had no hydrocarbons.
Tate & Lyle
Tate & Lyle added 5.2 percent to 704 pence, capping its best week since June 2010. The Financial Times and Daily Mail newspapers reported speculation that companies including Bunge could bid for the sugar producer. Bunge could make an offer of 850 pence a share, according to the Daily Mail, which also named Cargill Inc. as a possible suitor. Neither newspaper said where they got the information from.
Pearson Plc rose 3.8 percent to 1,090 pence, its highest price since July. The textbook publisher said it still forecasts adjusted earnings of 62 pence a share to 67 pence in 2014, adding that profit will be heavily weighted to the second half of the year. It also said its restructuring and investment program is on schedule to speed growth next year.