By Simon Kennedy, MarketWatch
LONDON (MarketWatch) — British stocks edged lower Monday, as most sectors traded in the red following the arrest of the head of the International Monetary Fund, though gains for software company Autonomy Corp. PLC and most mining stocks helped limit losses.
The FTSE 100 index UK:UKX -0.68% dropped 0.3% to 5,905.78 in early trading Friday.
British stocks still outperformed most other markets, particularly the French CAC 40 index FR:PX1 -1.36% . The French index was down 1.1% after the arrest of IMF chief Dominique Strauss-Kahn, who was also seen as a favorite to challenge French President Nicolas Sarkozy in elections next year.
Reuters
Dominique Strauss-Kahn (center), head of the International Monetary Fund, is facing charges he sexually assaulted a hotel maid.
Among fallers on the main index, shares in utility company Centrica PLC UK:CNA -1.67% dropped 1.4% after announcing a 30 million pound ($49 million) deal to buy PH Jones Group, a central-heating-services provider, and as natural-gas prices climbed.
Shares in Centrica had rallied nearly 5% in the first few sessions of last week.
Oil-and-gas company John Wood Group PLC UK:WG -1.24% dropped 0.9% after announcing the details of a plan to return 1.05 billion pounds ($1.7 billion) to shareholders.
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Strauss-Kahn arrest upends IMF
The arrest of IMF chief Dominique Strauss-Kahn has thrown into disarray the fund's leadership.
The company said it would initially offer to buy back shares at a discount to Friday’s closing price and would issue B shares to distribute any remaining cash.
Oil giant BP PLC UK:BP -0.60% BP -1.49% was down 0.5% ahead of a deadline to complete its share-swap deal with Russia’s Rosneft.
The initial deal also called for the companies to cooperate in an arctic exploration, but it was thrown into turmoil after BP’s partners in its existing TNK-BP joint venture in Russia said it violated an agreement that TNK-BP should be the vehicle used by BP for future Russian investment.
Shares in Autonomy UK:AU +5.54% were the biggest climbers, rising over 8% after the software company said it will buy selected assets of Iron Mountain Inc. IRM -1.67% for $380 million. The company said the deal will add between $130 million and $140 million to its revenue and result in cost savings of around $40 million a year.
Mining stocks rose, led by a 1.2% gain for Kazakhmys PLC UK:KAZ 0.00% after the firm said it will go ahead with plans for a secondary listing in Hong Kong. The company said its listing will boost its profile in China and Asia.
Among other mining stocks, Randgold Resources Ltd. UK:RRS -0.09% rose 0.8% as gold futures edged up in European trading. The June gold contract was up $3.30 at $1,496.90 an ounce.
African Barrick Gold PLC UK:ABG -3.17% , however, dropped 3.6% on the mid-cap market after the company said a malfunction at its Buzwagi mine will result in the mine running at reduced capacity for the next two weeks, and will cut production by around 10,000 ounces in the second quarter.
Among other mid-cap stocks, shares in London Stock Exchange PLC UK:LSE +2.48% climbed 2% after Canadian exchange operator TMX Group Inc. TMXGF -1.10% received a rival bid from a consortium of Canadian banks and pension funds.
The LSE said in a statement over the weekend that it “remains committed” to a deal with TMX on the terms that it has previously agreed.
Travel company Thomas Cook Group PLC UK:TCG -2.51% was another faller, dropping 1.7% after J.P. Morgan Cazenove downgraded the stock to neutral from overweight.
“While we were cognizant of the headwinds facing the U.K. division, first-half [results] highlighted that conditions were more challenging than forecast and we expect margin pressure to continue into next year,” said analyst Richard Stuber in a note to clients.
Simon Kennedy is the City correspondent for MarketWatch in London.
