BLBG: FTSE 100 Index Declines to Three-Month Low After Japan Is Hit by Tsunami
U.K. stocks fell to a three-month low, led by insurers Prudential Plc (PRU) and Aviva Plc (AV/), after an 8.9- magnitude earthquake in Japan triggered a 10-meter high tsunami.
Prudential slid 2 percent and Aviva lost 2.4 percent. Dixons Retail Plc (DXNS), the U.K’s largest consumer-electronics retailer, fell 2.3 percent after Citigroup Inc. cut its recommendation for the stock.
The benchmark FTSE 100 Index (UKX) retreated 21.92, or 0.4 percent, to 5,823.37 at 9:30 a.m. in London, touching the lowest level since Dec. 10. The benchmark is headed for a weekly loss of 2.8 percent. The FTSE All-Share Index (ASX) also dropped 0.4 percent today, while Ireland’s ISEQ Index lost 0.8 percent.
Global stocks fell for a third day today, and the Dow Jones Industrial Average in the U.S. yesterday posted its steepest decline since August, as violence in Libya, a slowdown in China’s export growth and concern that some European countries may fail to service debt hurt the outlook for equities.
“People may be starting to worry we’ll see a stronger correction, it does look quite weak,” said David Jones, chief market strategist at IG Index Plc. “The selling pressure has increased over the last few sessions and with the FTSE 100 at new lows it is raising some concern.”
Prudential fell 2 percent to 720.5 pence. Aviva declined 2.4 percent to 449.9 pence. The Stoxx Insurance 600 Index of European insurers declined 1.6 percent, the worst performance among 19 industries in the broader Stoxx 600.
Japanese Earthquake
Japan’s earthquake, the world’s strongest in more than six years, struck the coast of the country, causing a tsunami as high as 10 meters that inundated towns north of Tokyo. Airports were closed and bullet train services suspended. More than 4 million homes are without power, Tokyo Electric Power Co. said.
Dixons dropped 2.3 percent to 17.15 pence. The shares were cut to “hold” from “buy” at Citigroup, which said it cut profit estimates given indication of a “ step-down in high- ticket consumer demand patterns.”
FirstGroup Plc (FGP) sank 4.3 percent to 344.7 pence. The Aberdeen, Scotland-based transport company said the trading environment for its First Student school-bus unit “remains challenging.”
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.
