U.K. stocks fell after the U.S. joined the European Union in imposing sanctions on Russia for the Kremlin’s involvement in the insurgency in eastern Ukraine.
Antofagasta Plc retreated 4.6 percent after saying its cash costs climbed during the first half. Compass Group Plc lost 2.5 percent after the catering company said that the pound’s strength may hurt operating profit this financial year. Barclays Plc added 4.2 percent after the bank reported a return to profit in the second quarter. Travis Perkins Plc rose 2.7 percent as it announced a bigger-than-expected dividend.
The FTSE 100 Index dropped 34.31 points, or 0.5 percent, to 6,773.44 at the close in London. The benchmark gauge traded at 14.3 times the forecast earnings of its constituent companies yesterday, its highest valuation since 2009, according to data compiled by Bloomberg. The FTSE All-Share Index also lost 0.5 percent today, while Ireland’s ISEQ Index slipped 0.7 percent.
The Treasury Department introduced measures late yesterday preventing three Russian banks from selling equity and debt through the U.S. financial system. The government also banned transactions with a state-owned shipbuilder that serves the Russia’s oil-and-gas industry and navy. The EU yesterday agreed to bar state-owned Russian lenders from raising capital in the club’s 28 member states.
A Commerce Department report showed that the world’s largest economy expanded by an annualized 4 percent in the second quarter, beating the median economist estimate of 3 percent. The release also showed that gross domestic product contracted 2.1 percent in the first three months of this year, less than the previously estimated 2.9 percent decline.
The Federal Reserve will announce the pace of its quantitative-easing program after the close of U.K. markets. The central bank will lower its monthly asset purchases to $25 billion from $35 billion, according to economists surveyed by Bloomberg. That would put the Fed on track to halt all new bond purchases at its October meeting.
Antofagasta dropped 4.6 percent to 816 pence after saying that net cash costs rose 16 percent in the first half from a year earlier. The copper producer said it paid a one-off signing bonus to employees at its Esperanza facility in Chili after concluding a four-year pay agreement in May.
BHP Billiton Ltd., the world’s largest mining company, retreated 2.3 percent to 2,048 pence. Lead, tin and zinc all dropped on the London Metal Exchange.
Compass Group slid 2.5 percent to 983 pence. The food-service company said that full-year operating profit will drop by 92 million pounds ($156 million) and revenue by 1.2 billion pounds if sterling remains at its current levels against the currencies used in Compass’s main markets.
Barclays rose 4.2 percent to 228.4 pence after the lender posted a profit of 161 million pounds. It made a loss of 168 million pounds in the same period a year earlier.
Travis Perkins added 2.7 percent to 1,689 pence. The builders’ merchant announced an interim payout of 12.25 pence, more than the 11.2 pence Bloomberg Dividend Forecast.