By Barbara Kollmeyer and Victor Reklaitis, MarketWatch
Royal Mail hit by broker downgrade; grocers get a lift
NEW YORK (MarketWatch) -- U.K. stocks suffered a third session
of losses on Tuesday, weighed down as heavyweight HSBC continued to
sting in the wake of allegations it advised clients on ways to
avoid paying taxes in their home countries, and as commodity stocks
took another fall.
The FTSE 100 index pared earlier losses, but still closed down
0.1% at 6,829.12.
While the rest of Europe got a boost from helpful Greek
headlines, that didn't filter over to London. In Europe and London,
markets have recently been suffering amid escalating brinkmanship
between Greece and its eurozone partners.
HSBC Holdings PLC (HSBC) slumped, building on a drop Monday,
after media reports highlighted fresh details of tax-evasion claims
at the bank and allegations of its dealings with dictators and arms
dealers.
Read: HSBC should be probed, Democratic senator says
Another major pressure for the index came from oil firms as
crude prices (CLH5) continued to lose ground, backing away from
recent gains. BP PLC (BP) and Royal Dutch Shell PLC (RDSA) (RDSB)
both slumped.
Mining stocks also declined, with Rio Tinto PLC (RIO), BHP
Billiton PLC and Anglo American PLC all dropping. Those losses came
after China reported consumer price inflation fell to a five-year
low, adding to concerns about deflation in a slowing economy.
A broker downgrade hit shares of Royal Mail Group PLC . The mail
carrier lost nearly 5% after J.P. Morgan Cazenove cut it to neutral
from overweight, citing a "diminished risk/reward profile" and
concerns about a near-term decline in consensus estimates.
On the plus side, retail-oriented stocks were higher, with Marks
& Spencer Group PLC among advancers. Wm. Morrison Supermarkets
PLC and Tesco PLC jumped after market researcher Kantar Worldpanel
reported that the grocery sector in the U.K. grew at 1.1%, the
fastest rate of growth since June 2014.
Tesco returned to growth for the first time since January 2014,
and Morrison's sales fell by 0.4%, which was the best performance
from the retailer since December 2013, Kantar said.
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