BLBG:U.K. Stocks Fall As King Says No Clear End To Euro Crisis
U.K. stocks declined after Bank of England Governor Mervyn King said there was no end in sight for the euro-area debt crisis and as Japan’s gross domestic product expanded less than estimated.
Petrofac (PFC) Ltd. fell 5 percent after saying profit growth in the second half will be lower than in the first half. Standard Chartered Plc (STAN) rose 1.5 percent on a report the bank has discussed a settlement with New York regulators over money laundering allegations.
The FTSE 100 Index retreated 0.4 percent to 5,826.29 at 9:07 a.m. in London after gaining for the past two weeks. The broader FTSE All-Share Index slid 0.4 percent, while Ireland’s ISEQ Index lost 0.2 percent. The number of shares changing hands on the FTSE 100 (UKX) was 42 percent lower than the average of the past 30 days, according to data compiled by Bloomberg.
King said the U.K. must press on with reforms to the banking industry and repeated his gloomy outlook for the euro- area debt crisis, which is impeding Britain’s economy.
“If the rest of the world were growing normally, the rebalancing and recovery of our economy would be much easier,” King wrote in an article in the Mail on Sunday newspaper. “But it isn’t. Even the rapidly expanding emerging-market economies are slowing, and the problems of the euro area continue with no obvious end in sight.”
Japanese Growth
Japan, the world’s third-largest economy, expanded at an annualized 1.4 percent in the three months through June, compared with a revised 5.5 percent expansion in the first quarter, the Cabinet Office said today. The median forecast of 24 economists surveyed by Bloomberg was for 2.3 percent growth.
Federal Reserve Bank of San Francisco President John Williams said the central bank should ease policy further, according to an interview in the San Francisco Chronicle.
Petrofac, a builder of oil and gas facilities, slipped 5 percent to 1,488 pence. The company said year-on-year net profit growth in the second half will be lower than in the first half as projects are delayed.
Standard Chartered climbed 1.5 percent to 1,346 pence. The lender and New York regulators have discussed a settlement amount to resolve the inquiry into whether the bank’s records hid transactions tied to Iran, Reuters reported, citing people familiar with the situation. The amount was not disclosed.
Standard Chartered tumbled 15 percent in London last week after being accused of violating U.S. money laundering laws over its dealings with Iranian banks, raising concern the bank may lose its license to operate in New York.
To contact the reporter on this story: Adria Cimino in Paris at acimino1@bloomberg.net
To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net
