U.K. Stocks Decline as Investors Await ECB Rate DecisionInyoung Hwang
U.K. stocks declined, extending a monthly drop, as investors awaited U.S. economic data and the European Central Bank’s interest-rate decision later this week.
Shanks Group Plc slid 5.5 percent after Liberum Capital downgraded its rating on the waste-management provider. Babcock International Group Plc jumped 4.3 percent after a unit’s joint venture was selected as a preferred bidder to buy nuclear-site licencing companies. Rio Tinto Group and Anglo American Plc climbed more than 1 percent as a gauge of miners rose.
The FTSE 100 Index fell 17.21 points, or 0.3 percent, to 6,598.37 at the close in London. The benchmark gauge fell in the last 30 minutes of trading after earlier rising as much as 0.7 percent. The index lost 3.1 percent this month and 2.2 percent this quarter. The broader FTSE All-Share Index retreated 0.1 percent today, while Ireland’s ISEQ Index added 0.1 percent.
“It looks like a day of anticipation,” Keith Bowman, an equity analyst at Hargreaves Lansdown Plc in London, said by telephone. “Coming up this week are the ECB policy meeting, U.S. non-farm payroll figures. There are also still expectations in the market for further Chinese stimulus, which is helping miners today.”
Federal Reserve Chair Janet Yellen said in Chicago that “considerable slack” in the labor market shows the central bank’s unprecedented accommodation will still be needed for some time to put Americans back to work.
Investors are awaiting payroll data due April 4 to assess the outlook for U.S. interest rates. Separate reports this week may show that manufacturing in the world’s largest economy expanded this month, while factory orders probably rebounded in February, according to forecasts in Bloomberg News surveys.
On April 3, the ECB will probably maintain its key interest rate at a record low of 0.25 percent, economists surveyed by Bloomberg said.
Shanks Group slid 5.5 percent, its biggest drop since November 2012, to 110.8 pence. The waste-management provider reported pressure on volumes and prices at its Benelux operation in the first quarter and a slower-than-anticipated pick-up in market activity in March. It forecast a challenging environment through 2014. Liberum downgraded its rating to hold from buy, citing expectations of unchanged profit in fiscal-year 2015.
Babcock jumped 4.3 percent to 1,347 pence, the engineering and facilities-management provider’s biggest gain since May. The Nuclear Decommissioning Authority selected Cavendish Flour Partnership as the preferred bidder to buy Magnox Ltd. and Research Sites Restoration Ltd., the licence companies for 12 U.K. nuclear sites. Cavendish Flour is a joint venture between Cavendish Nuclear, a unit of Babcock, and Flour Corp.
China may roll out specific policies to support economic growth, analysts led by Lu Ting at Bank of America Corp. wrote in a note dated March 28, after Premier Li Keqiang said the nation can’t ignore increasing difficulties. The official expansion target for this year is 7.5 percent, although investment banks including Goldman Sachs Group Inc. and UBS AG have lower forecasts.
A gauge of FTSE 350 mining stocks rose. Rio Tinto climbed 1.8 percent to 3,337.5 pence and Anglo American advanced 1.2 percent to 1,526.5 pence.
Resolution Ltd. added 0.8 percent to 298.8 pence, while Aviva Plc rose 1.5 percent to 477 pence. A gauge of insurers gained in the Stoxx Europe 600 Index. Shares slid on March 28 after the U.K.’s Financial Conduct Authority said it is planning an inquiry into the treatment of long-standing life-insurance customers.