By Sara Sjolin, MarketWatch
LONDON (MarketWatch)—Most U.K. stocks traded lower Monday as energy stocks pulled back after a broker downgrade, while banks also weighed on investor mood in the wake of recent rallies.
The FTSE 100 index UK:UKX -0.09% dropped 0.1% to 5,959.45, falling from an almost eight-month high.
Among the biggest decliners in the index, National Grid PLC UK:NG -1.63% lost 1.8% after Bank of America Merrill Lynch cut the stock to neutral from buy on valuation grounds.
Energy stocks weighed the heaviest in London after Morgan Stanley cut the sector to neutral from overweight as the sector’s dividend yield is close to a long-term low. BG Group PLC UK:BG -0.55% shed 0.9% and Cairn Energy PLC UK:CNE -0.33% declined 0.5%.
Miners, however, supported the U.K. index as commodity prices headed north. Rio Tinto PLC UK:RIO +0.88% RIO +1.16% added 1.6%, Eurasian Natural Resources Corp. PLC UK:ENRC +0.15% took on 1%, Xstrata PLC UK:XTA +0.30% rose 0.9%, while BHP Billiton PLC UK:BLT +0.39% traded 0.9% higher.
Antofagasta PLC UK:ANTO +1.06% advanced 1.9%. Exane BNP Paribas lifted the stock to outperform from neutral as the miner is preparing expansions in Chile, which could double copper production by the end of the decade.
Banks weighed in London and Standard Chartered PLC UK:STAN -0.81% fell 1.1%, Lloyds Banking Group PLC UK:LLOY -0.89% LYG +0.43% lost 0.6% and HSBC Holdings PLC UK:HSBA -0.67% HBC +0.02% declined 0.7%.
Standard Life PLC UK:SL -1.64% traded 1.4% lower after Credit Suisse cut the stock to underperform on valuation grounds and pointed to Prudential PLC UK:PRU +0.13% for better value.
Bucking the negative trend in London, Vodafone Group PLC UK:VOD +0.90% VOD +1.17% added 0.8%. The Sunday Times reported that the telecom firm may save 1 billion pounds ($1.58 billion) in taxes if it succeeds in bidding for Cable & Wireless Worldwide PLC UK:CW +3.73% . Shares of Cable & Wireless Worldwide advanced 3.5%.
Outside the main index, Misys PLC UK:MSY +7.98% jumped 8.4% after it announced Vista Equity Partners agreed to buy the software company for £3.5 a share. Read more about Misys.
