U.K. Stocks Pare Drop as Putin Says Troops Withdraw

U.K. stocks pared their decline in the final 30 minutes of trading as Vladimir Putin said Russia has withdrawn its troops from the border with Ukraine, offsetting losses by banks after HSBC Holdings Plc reported reduced profit.

HSBC fell 1.3 percent after Europe’s largest bank said first-quarter profit dropped 20 percent. Barclays Plc declined 0.7 percent after Citigroup Inc. said the lender may push back a profitability target by a year. J Sainsbury Plc slipped 2.9 percent after Kantar Worldpanel said the supermarket chain lost market share in the last 12 weeks. Legal & General Group Plc added 3 percent after reporting earnings.

The FTSE 100 Index slipped 2.12 points, or less than 0.1 percent, to 6,796.44 at the close in London, paring a drop of as much as 0.5 percent. The benchmark has climbed for the last three weeks amid an increase in mergers-and-acquisitions activity. The FTSE All-Share Index lost 0.1 percent today, while Ireland’s ISEQ Index fell 1.1 percent.

“Banks played a big role in the U.K.’s decline today, with HSBC and Barclays falling,” said John Plassard, vice president at Mirabaud Securities LLP in Geneva. “It only adds to the persistent fears about the situation in Ukraine, which could bring more volatility to the markets.”

Putin said Russia has withdrawn its forces from the border with Ukraine. The Russian president spoke following a meeting with the Organization for Security and Co-operation in Europe.

U.S. Secretary of State John Kerry repeated late yesterday that America and the European Union will impose further sanctions against Russia if Vladimir Putin’s government prevents Ukraine’s presidential election from taking place on May 25. Kerry spoke hours after Russian Foreign Minister Sergei Lavrov called on the acting government in Kiev to postpone the vote until it stops its military action against separatists.

Banks Decline

HSBC lost 1.3 percent to 596.5 pence. Pretax profit fell to $6.79 billion from $8.43 billion in the first three months of 2013, the London-based lender said in a statement today. That compares with the $6.77 billion average estimate of six analysts surveyed by Bloomberg.

Barclays retreated 0.7 percent to 243.3 pence. Citigroup said Britain’s second-largest lender may announce it won’t meet its target of an 11.5 percent return on equity until 2017, a year later than planned, and won’t meet its goal of cutting costs to about half of income until 2016 rather than 2015.

Experian Plc dropped 6.5 percent to 1,060 pence, the credit-rating service’s largest decline since November 2008. The company said subdued trading in Brazil because of the forthcoming World Cup soccer tournament will impede first-half growth. Experian also posted 12-month revenue of $4.8 billion today, less than the $4.89 billion that analysts had projected.

Sainsbury Drops

Sainsbury retreated 2.9 percent to 323.9 pence after Kantar said the 12-week market share of the U.K.’s third-largest supermarket chain declined to 16.6 percent from 16.8 percent. The company also reported pretax profit excluding one-off items of 798 million pounds ($1.4 billion) in the 12 months through March 15, more than the average analyst estimate of 783.3 million pounds.

CRH Plc dropped 3.5 percent to 1,679 pence as a gauge of construction-and-materials companies posted the biggest decline on the FTSE 350 Index.

Legal & General advanced 3 percent to 220 pence. Bulk sales of annuities to company-pension plans rose to a record 3 billion pounds in the first quarter, the life insurer said, adding that it expects sales this year to exceed the 4.1 billion-pound total for 2013.

EasyJet Plc climbed 2.6 percent to 1,710 pence. Europe’s second-biggest discount airline said it flew 5.79 million passengers in April, up from 5.25 million a year earlier.

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