UK shares dropped for a second day after the FTSE 100 Index’s biggest flop in a single week in two months, as investors assessed escalating violence in Iraq following the capturing of more territory by Sunni militants.
BT Group went down 2.4% after Sunday Times wrote that the firm may have to hike its pension contributions. Persimmon Plc reported its worst two-day flop since August. Bovis Homes Group Plc lost 1% as data showed prices of homes in UK advanced at the slowest rate since 2014. A measure of mining stocks bounced back from its lowest point since March. Tullow Oil Plc and Premier Oil Plc surged the most among oil producers.
The FTSE 100 plunged 23.21 points, 0.3% to 6,754.64 at the end of trading in London. The blue-chip index shed 1.2 last week as George Osborne announced that UK’s central bank would get powers to tame the home-loan market, while Governor of Bank of England Mark Carney said interest rates may hike earlier than anticipated. The gauge is 1.8% lower than its 14-year peak hit on May 14. The FTSE All Share Index dropped 0.4% on Monday. ISEQ Index of Ireland sank 0.8%.
“Iraq is one element of concern for the market. There are implications to deal with wherever you go in U.K. stocks. You’ve got geopolitical uncertainty affecting the multinationals, while Carney’s comments last week clearly did something for the domestic play,” Tim Rees of London-based Insight Management Ltd in London told Bloomberg.
A measure of mining shares listed in the FTSE 350 soared 0.8%.Fresnillo Plc surged 1.9% to 822 pence, a gain for the sixth day. Polymetal International Plc rose 1% to 543.5 pence.
Vodafone Group sank 0.5% after the carrier announced its intentions to spend 145 million euros ($197.5 million) in the purchase of Cobra Automotive Technologies, MarketWatch reported.
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