By Dow Jones Business News, March 21, 2013, 08:25:00 AM EDT
By Sara Sjolin, MarketWatch
LONDON (MarketWatch) -- U.K. stocks moved lower on Thursday, led by banks and oil firms amid worries of financial
troubles in Cyprus, as investors shrugged off better-than-expected U.K. retail sales for February.
The FTSE 100 index traded 0.8% lower at 6,378.83, setting it on track for a fifth straight day of losses.
Oil firms were among heaviest decliners, tracking losses for oil prices. Shares of BG Group PLC lost 1.2%, BP PLC
(BP) dropped 0.7% and Royal Dutch Shell PLC (RDSB) fell 0.7%.
Banks were also on the decline, tracking a negative sentiment across Europe where concerns that Cyprus won't reach a
bailout deal with its international lenders kept investors on edge. The European Central Bank said it may cut off
emergency bank help for the ailing country if it fails to agree on a rescue package with the European Union and the
International Monetary Fund by Monday March 25.
Shares of heavyweight HSBC Holdings PLC ( HBC ) shaved off 1%, Royal Bank of Scotland Group PLC (RBS) fell 1.1% and
Lloyds Banking Group PLC lost 0.8%.
Investors in the U.K. seemed unfazed by upbeat data from the Office for National Statistics showing retail sales rose
2.6% on a yearly basis in February, beating analysts' expectations.
"Although pay growth remains very subdued and real incomes continue to be squeezed, we suspect some of the recent
improvement in sales may have been led by the steady improvement in the U.K. labor market, helping to boost spending
power across the population," said Victoria Clarke, economist at Investec Securities, in a note.
"We would expect some of that momentum to continue through the year ahead as the jobs recovery builds and confidence
gradually returns," she added.
Shares of fashion retailer Next PLC rose 3%, as the firm posted a 15% in pretax profit and raised dividends for the
Shares of AstraZeneca PLC (AZN) climbed 2.2%. The drug maker presented a new growth strategy that slash 2,300 jobs,
which will result in benefits of about $800 million by 2016.
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