By Shashwat Chauhan
(Reuters) -Britain’s FTSE 100 fell on Tuesday, dragged by financials, with Barclays dipping after Qatar Holdings cut its stake in the lender, while China-exposed banks fell following a credit outlook cut by Moody’s.
The blue-chip FTSE 100 lost 0.6%, its second day in the red, while the more domestically-focussed FTSE 250 mid-cap index added 0.2%.
Barclays fell 2.4% after Qatar Holdings, one of the bank’s largest shareholders, moved to sell around 510 million pound ($644 million) of its stock, cutting back on its global financial crisis-era investment.
Meanwhile, Moody’s cut its outlook on China’s government credit ratings to “negative” from “stable”, citing lower medium-term economic growth and an ongoing downsizing of the property sector.
China-exposed lenders HSBC and Standard Chartered fell 0.9% and 0.4%, respectively, while insurer Prudential lost 2.0%.
Daniela Sabin Hathorn, a senior market analyst at Capital.com said the Moody’s downgrade is an influential factor in Tuesday’s fall.
“But we’re coming from a period where we’ve seen a ‘buy everything’ rally and we’re seeing that tested today,” Hathorn added.
On the data front, a survey showed activity in Britain’s services sector grew in November after three months of declines.
Investors are also awaiting U.S. employment data this week, with the October JOLTS number due later in the day, along with the November ADP National Employment and the nonfarm payrolls report for November due later in the week.
The London Stock Exchange said regular activity had resumed after a brief outage affected its trading and information system and disrupted small-cap stock trades, the second such incident in less than two months.
FTSE 100, FTSE 250 and International Order Book securities – shares listed in London by overseas companies – had continued to trade normally, the exchange said.
The FTSE small cap index was trading flat as of 1044 GMT.
In the UK, financial markets increased bets on an earlier start to interest rate cuts by the Bank of England, after a European Central Bank policymaker said further interest rate hikes were “rather unlikely” for the euro zone.
(Reporting by Shashwat Chauhan in Bengaluru; Editing by Sonia Cheema, Varun H K and Mrigank Dhaniwala)