By Sara Sjolin, MarketWatch
LONDON (MarketWatch) — U.K. stocks headed lower Wednesday, as energy firms tracked a retreat in crude-oil prices, while banks rose on news of looser capital rules.
The FTSE 100 index UK:UKX -0.36% lost 0.4% to 5,788.44.
Shares of BAE Systems PLC UK:BA -0.80% nudged 0.4% lower, after talks over what would have been a $45 billion merger with EADS NV FR:EAD +4.75% collapsed as the involved governments failed to agree on the tie-up. See: EADS-BAE merger collapses on government opposition
Banks posted some of the biggest gains in the FTSE 100, keying off a Financial Times report that the Financial Services Authority has eased capital rules for the biggest banks in an effort to boost lending. See: FSA eases rules for U.K. banks to spur lending
Lloyds Banking Group PLC UK:LLOY +4.49% LYG +5.08% gained 3.9% and Royal Bank of Scotland Group PLC UK:RBS +2.29% RBS +3.05% added 2.4%, while Barclays PLC UK:BARC +0.43% BCS +1.17% picked up 0.3% and sector heavyweight HSBC Holdings PLC UK:HSBA +0.17% HBC +0.34% HK:5 -0.67% ticked 0.1% higher.
Energy shares weakened as oil prices were on the decline, on the heels of a big Tuesday rally in New York. BP PLC UK:BP -0.10% BP +0.21% gave up 0.8% and Royal Dutch Shell PLC UK:RDSB -0.05% RDS.B -0.04% fell 0.4%, while and BG Group PLC UK:BG -0.15% lost 0.3%.
GlaxoSmithKline PLC UK:GSK -0.80% GSK -0.28% dropped 0.6%. Its vaccines division agreed with biotech group Aeras to jointly assess an experimental tuberculosis vaccine.
And shares of chip maker ARM Holdings PLC UK:ARM -2.52% sank 1.8%. Credit Suisse initiated coverage with a neutral rating, saying a “lack of near-term catalysts” balanced out ARM’s “strong earnings reliability.”
Sara Sjolin is a MarketWatch reporter, based in London.
