U.K. Stocks Little Changed After U.S. Retail Sales Report
U.K. stocks closed little changed, as the FTSE 100 Index (UKX) posted a second week of gains, as U.S. retail-sales growth missed estimates and as investors watched talks between the U.S. and Russia on Syria.
Polymetal International Plc led gold producers lower as Goldman Sachs Group Inc. predicted the precious metal’s price could fall below $1,000 an ounce. Kentz Corp. (KENZ) fell for an eighth day after M+W Group GmbH said it won’t make an offer for the oil-services company. Imagination Technologies Group Plc (IMG) jumped 11 percent after announcing an expanded partnership with MediaTek Inc.
The FTSE 100 Index slid 5.18 points, less than 0.1 percent, to 6,583.8 in London. The gauge climbed 0.6 percent this week amid better-than-expected economic data from China and as U.S. President Barack Obama delayed a decision on military action against Syria. The broader FTSE All-Share Index declined less than 0.1 percent today, while Ireland’s ISEQ Index slipped 0.7 percent.
“The figure is not too bad,” said Robert Carnell, chief international economist at ING Bank NV in London, wrote in a note. “It is not bad enough to shift the Fed from the course of action they seem destined to fulfill next week. The taper is on its way.”
The volume of shares changing hands in companies listed on the FTSE 100 was 20 percent lower than the 30-day average, according to data compiled by Bloomberg.
Retail sales increased 0.2 percent in August, the smallest in four months, according to a U.S. Commerce Department report in Washington. That compares with the median forecast of 0.5 percent increase in a Bloomberg News survey. The department revised the increase in July to 0.4 percent.
The retail report is one of the last pieces of data before Federal Reserve policy makers meet Sept. 17-18 to consider reducing monthly bond purchases. Fed Chairman Ben S. Bernanke has said that the central bank may consider tapering if the economy continues to grow in line with its forecasts.
U.S. Secretary of State John Kerry meets Russian counterpart Sergei Lavrov in Geneva to discuss a deal to remove Syria’s chemical weapons. Syrian President Bashar al-Assad said that the administration of President Barack Obama must stop its military threats and cease arming rebel groups for the nation to give up its chemical arsenal.
“Syria is an uncertain situation,” James Buckley, a London-based fund manager at Baring Asset Management Ltd., which oversees about $50 billion, said by telephone. “There are tensions in the background that could emerge anytime.”
Goldman Sachs Group Inc., which has estimated the price of gold to be $1,050 an ounce in 2014, now says the precious metal could fall below $1,000 as the U.S. economy improves and the Federal Reserve cuts stimulus. Gold touched a high of $1,900.20 in September 2011.
Polymetal International Plc dropped 3.5 percent to 709.5 pence. African Barrick Gold Plc lost 2 percent to 164.2 pence. A gauge of London-listed mining companies fell 1.6 percent. Anglo American Plc retreated 3.2 percent to 1,568.5 pence. Glencore Xstrata Plc slid 0.6 percent to 341.5 pence.
Kentz lost 1.4 percent to 492 pence, for the longest losing streak since January 2012. M+W Group, a German engineering and construction company, said it doesn’t intend to make another bid for Kentz after its indicative offer in July was rejected by the latter’s board. Kentz yesterday slumped the most in two years after Amec Plc said it won’t make an offer.
Imagination Technologies jumped 11 percent to 339.7 pence. The designer of chip technology for phones and tablets announced it expanded its partnership with Taiwan-based semiconductor maker MediaTek for wireless-communication and digital-multimedia products.
Fenner Plc (FENR) rallied 5.2 percent to 407.4 pence, its highest price since March 20. UBS AG started coverage of the conveyor-belt maker with a buy rating, saying shares are cheap. The bank predicted the stock will climb to 460 pence in the next 12 months.
Reckitt Benckiser Group Plc (RB/) advanced 2.3 percent to 4,554 pence. The film version of the company’s Suboxone opioid-dependency drug continues to gain market share six months after the entry of generic competition, Sanford Bernstein wrote in a note.
ITV Plc (ITV) climbed 2.1 percent to 183.4 pence, its highest price since at least February 2004. Media buyers are indicating accelerating growth in U.K. and German advertising, according to Nomura Holdings Inc., which highlighted ITV, the owner of the U.K.’s most-watched commercial TV station, as still offering potential for price increases.
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