Bloomberg News

Most U.K. Stocks Drop as Slovakia Debates European Bailout Fund

October 11, 2011

Oct. 11 (Bloomberg) -- Most U.K. stocks fell, halting the biggest four-day advance for the FTSE 100 Index since November 2008, amid uncertainty that Slovakia will ratify the expansion of the euro area’s bailout fund.

Mining companies led the drop, paced by Eurasian Natural Resources Corp. and Antofagasta Plc, as base metal prices tumbled in London. BG Group Plc retreated as China extended a value-based tax on sales of oil and natural gas and crude oil fell. Bank shares limited declines.

The benchmark FTSE 100 slid 3.3, or 0.1 percent, to 5,395.7 at the close in London as three stocks fell for every two that rose. The FTSE All-Share Index was little changed while Ireland’s ISEQ Index declined 1.3 percent in Dublin.

The rally “has stalled after some hesitation on Slovakia’s part about approving an extension” of the bailout fund, said Christopher Purdy, trader at Spreadex Ltd. in St. Alban’s, England. “This hesitation casts further doubt over how long a set of states with vastly differing opinions can operate in concert.”

The FTSE 100 had surged 9.2 percent over the previous four days as German and French leaders pledged to create a plan in three weeks to recapitalize banks in Europe. A planned reinforcement of the European Financial Stability Facility, the bailout fund known as the EFSF, faced a vote today in Slovakia’s parliament. Slovakia is the only country that hasn’t ratified the fund.

Miners Fall

Antofagasta slid 1.6 percent to 1,077 pence, falling for the first time in five days. ENRC lost 2.3 percent to 625 pence and Anglo American Plc slid 1.1 percent to 2,391 pence.

Copper led base metals lower as Chinese export growth waned in September. Copper for delivery in three months fell as much as 4.5 percent to $7,159.75 a metric ton. Aluminum, zinc, tin, nickel and lead also declined.

Cairn Energy Plc declined 1.4 percent to 293.7 pence as crude oil fell from its highest level in more than two weeks in New York. Tullow Oil Plc slid 0.8 percent to 1,397 pence.

BG Group slipped 0.6 percent to 1,307.5 pence. China said it will extend a value-based tax on sales of oil and natural gas starting next month to help save energy in the world’s fastest- growing major economy.

Banks limited losses on the FTSE 100 today, led by Royal Bank of Scotland Group Plc which gained 2.8 percent to 25.30 pence. Barclays Plc rose 2.1 percent to 175.7 pence and Lloyds Banking Group Plc increased 1.6 percent to 36.28 pence.

Rockhopper’s Finds

Elsewhere, Rockhopper Exploration Plc surged 13 percent to 191.25 pence. Its shares saw a volume 2 1/2 times the average in the last three months. The company, which explores for oil to the north of the Falkland Islands, raised its estimate of oil resources at the Sea Lion field. It said the field may hold 844 million to 1.4 billion barrels of oil. In August, the company estimated resources in the range of 608 million to 1.3 billion barrels.

Mothercare Plc surged 9.2 percent to 210.2 pence after the children’s clothing retailer said Chief Executive Officer Ben Gordon will step down. The company last week warned that trading was “well below” forecasts.

CSR Plc dropped 5.8 percent to 183.4 pence after Citigroup Inc. downgraded the U.K. semiconductor maker to “sell” from “neutral,” citing “very strong competition” in digital television from Taiwan.

--With assistance from Sarah Jones in London. Editors: Srinivasan Sivabalan, Andrew Rummer

To contact the reporter on this story: Alexis Xydias in London at axydias@bloomberg.net

To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net


Burger King's Young Buns
LIMITED-TIME OFFER SUBSCRIBE NOW

(enter your email)
(enter up to 5 email addresses, separated by commas)

Max 250 characters

 
blog comments powered by Disqus