U.K. Stocks Drop as Investors Weigh Iraq, Ukraine UnrestJonathan Morgan
U.K. stocks declined for a third day, led by energy and commodity companies, as investors weighed geopolitical uncertainty in Iraq and Ukraine.
Meggitt Plc dropped the most in 15 weeks after JPMorgan Chase & Co. downgraded the shares. Tullow Oil Plc retreated 2.8 percent. Anglo American Plc and Antofagasta Plc slipped at least 2 percent each as a gauge of London-listed commodity producers fell for a second day.
The FTSE 100 Index slid 53.45 points, or 0.8 percent, to 6,733.62 at the close of trading in London, its lowest level since April 28. The benchmark measure climbed 0.7 percent last week as the Federal Reserve pledged to keep interest rates low. The broader FTSE All-Share Index lost 0.8 percent today, while Ireland’s ISEQ Index retreated 0.6 percent.
“It is clear that geopolitical tensions are a cause of concern, more for the U.K. market than others because of the heavy weighting of oil and resources companies,” said Pierre Mouton, who helps oversee about $8 billion at Notz, Stucki & Cie. in Geneva.
The integrity of the Iraqi state has come under threat with an al-Qaeda offshoot known as the Islamic State in Iraq and the Levant consolidating its territorial gains, U.S. military and intelligence officials said.
In Ukraine, pro-Russian rebels violated a cease-fire and shot down a government helicopter, prompting President Petro Poroshenko to say he will cancel the week-long truce early if the violence continued. He called for immediate talks with Russia, Germany and France to end the bloody conflict.
Meggitt dropped 3.2 percent to 508.5 pence. JPMorgan downgraded the provider of wheels and brakes for aircraft to underweight, or sell, from neutral, citing weaker defense sales, currency swings and issues with product quality.
Tullow Oil Plc, the explorer, retreated 2.8 percent to 846.5 pence.
Anglo American, the owner of the world’s largest platinum mine, fell 2 percent to 1,427.5 pence. Antofagasta, the copper producer controlled by Chile’s Luksic family, retreated 2.1 percent to 762.5 pence. The FTSE 350 Mining Index lost 1 percent.