Reuters logo
HSBC fall weighs on UK's FTSE as rebound loses steam
October 20, 2014 / 8:37 AM / in 3 years

HSBC fall weighs on UK's FTSE as rebound loses steam

* FTSE 100 falls 0.4 pct

* HSBC edges lower after Citigroup price target cut

* Tesco up on media report of bid interest for Asian assets

By Sudip Kar-Gupta

LONDON, Oct 20 (Reuters) - Britain’s top equity index slipped on Monday, as last week’s bounce off 15-month lows faded and a dip in the shares of global bank HSBC pegged back the market.

The blue-chip FTSE 100 index, which on Friday had risen 1.9 percent, was down by 0.4 percent, or 23.27 points, at 6,287.02 points in early session trading.

Hantec Markets analyst Richard Perry remained wary of stock market volatility, fed by weak European economic data over the last two weeks.

“There was a huge bounce up on Friday, but I don’t think the volatility will go away,” said Perry.

A 0.9 percent fall in HSBC’s shares took the most points off the FTSE by an individual stock.

Traders attributed the fall to a decision by U.S. bank Citigroup to trim its price target on the stock to 675 pence from 685 pence.

Citigroup said this reflected the impact of regulatory fines on HSBC, such as last month’s move to pay $550 million to resolve a U.S. regulator’s claims of false representations in selling mortgage bonds to Fannie Mae and Freddie Mac before the financial crisis.


Tesco, whose shares have slumped some 20 percent over the last month after it said its profits had been overstated, beat the broader market downturn to rise 2 percent, making it the best-performing FTSE stock in percentage terms.

Traders attributed Tesco’s move higher to a report in The Times that private equity companies were planning to make offers for Tesco’s 9 billion pound ($14.5 billion) Asian business, and to a Sky News report that Tesco’s accounting black hole would be less than originally stated.

“There’s probably a bit of bargain hunting going on with Tesco at these levels, but I still think they’ve got more problems to face down the road,” said Central Markets trading analyst Joe Neighbour. (1 US dollar = 0.6208 British pound) (Reporting by Sudip Kar-Gupta; Editing by Ruth Pitchford)

Our Standards:The Thomson Reuters Trust Principles.
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below