U.K. stocks closed little changed as concern Europe’s debt crisis is deepening and speculation China’s banks may fail to meet loan targets offset an increase in U.S. consumer confidence.
Lloyds Banking Group Plc (LLOY) and Barclays Plc (BARC) declined at least 1.9 percent. Xstrata Plc and Vedanta Resources Plc (VED) fell as mining companies retreated. Aggreko Plc (AGK) climbed 2.4 percent after analysts upgraded the shares.
The FTSE 100 Index added 1.48, or less than 0.1 percent, to 5,351.53 at the close in London, bringing its gains this week to 1.6 percent. The measure dropped and rose as much as 0.7 percent today. The FTSE All-Share Index slipped 0.1 percent, while Ireland’s ISEQ Index rallied 1.2 percent.
“The euro-zone economy as a whole is struggling to stay out of the negative side,” said Philippe Gijsels, a market research analyst at BNP Paribas Fortis Capital Markets in Brussels. “The positives are that central banks will do whatever they can to stabilize things. But at the moment it is difficult to see which of the two is going to win out.”
The FTSE 100 (UKX) has lost 10 percent from its 2012 high on March 16 as Greece failed to form a government that can handle the nation’s debt payments and borrowing costs for Spain surged. Artur Mas, president of Spain’s Catalonia region, today reiterated his call for the Spanish central government to help regions access funding.
China’s biggest banks may fall short of loan targets for the first time in at least seven years as an economic slowdown crimps demand for credit, three bank officials with knowledge of the matter said. A decline in lending in April and May means it’s likely the banks’ total new loans for 2012 will be about 7 trillion yuan ($1.1 trillion), less than an estimated government goal of 8 trillion yuan to 8.5 trillion yuan, said one of the officials, declining to be identified because the person isn’t authorized to speak publicly.
In the U.S., consumer confidence rose in May to the highest level since October 2007 as prices at the gas pump became less of a drag on household budgets. The Thomson Reuters/University of Michigan final index of consumer sentiment climbed to 79.3 from 76.4 the prior month.
Italian Prime Minister Mario Monti said that most of Europe’s leaders support the issue of joint bonds for the euro area. Monti told television station La7 yesterday that Italy can help persuade Germany to support Europe’s “common good.”
The FTSE 100’s valuation has fallen to 9.6 times its companies’ estimated earnings, near the cheapest since November, according to data compiled by Bloomberg.
Lloyds, Britain’s biggest mortgage lender, fell 4.1 percent to 25.8 pence. Barclays, the nation’s second-largest bank by assets, declined 1.9 percent to 181.7 pence.
A gauge of London-listed mining companies retreated 1.5 percent today. Xstrata lost 2.4 percent to 912.6 pence, Vedanta dropped 3.3 percent to 966.5 pence and Fresnillo Plc (FRES) slid 2.2 percent to 1,317 pence.
Bumi Plc (BUMI), an owner of stakes in two Indonesian power- station coal producers, tumbled 9.7 percent to 360.3 pence, a record low.
Aggreko climbed 2.4 percent to 2,157 pence. HSBC Holdings Plc upgraded the world’s largest provider of mobile-power supplies to overweight, the equivalent of buy, from neutral.
Cape Plc (CIU), a supplier of fire protection, scaffolding and cleaners to energy companies, slid 37 percent to 205 pence, the largest decline since 2002, after saying it will take a charge for losses on an Algerian project.
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