Reuters
Published May 09, 2011 07:46AM ET
* FTSE down 0.6 percent
* HSBC slips on cost concerns, falling profit
* Near-term outlook for equities choppy, JPMorgan
By David Brett
LONDON, May 9 (Reuters) - Britain's FTSE 100 was lower at
midday on Monday, with HSBC
Europe's biggest bank and peer Barclays
By 1051 GMT, the FTSE 100 <.FTSE> fell 36.64 points, or 0.6 percent, at 5,940.13.
The index lost some of Friday's 1.0 percent gains, when investors were buoyed by a U.S. jobs report, which beat on headline job creation numbers but fell short of expectations on unemployment figures. Europe's debt problems also dampened risk appetite.
Banks were weak as investors digested HSBC's
Europe's biggest bank fell 1.6 percent after it reported a 14 percent fall in first-quarter profits year-on-year, as rising costs offset lower bad debts. [ID:nLDE7480EF]
Investors are now focusing on the company's strategic update due later in the week for clues on how the bank intends to combat cost pressures.
Barclays
Eurozone debt worries were also a factor as the UK market retreated. Greek government bond yields jumped on deepening concerns over the country's debt crisis, following a meeting on Friday of top euro zone finance ministers.
"The market is looking towards the euro zone, and Greece in particular, given the murmurs emanating about the potential need for a second bailout or even an exit from the Euro (denied on Saturday by Greek Prime Minister George Papandreou)," a London-based trade said.
COMMODS MIXED
Energy .FTNMX0530 and mining .FTNMX1770 shares were mixed as commodities staged a mini recovery following last week's sell-off, as global growth concerns lingered.
JPMorgan asset management, in its weekly global asset strategy note, said its latest quantitative model output reaffirms a positive approach towards risk in the medium term, with equities faring well against bonds and cash.
But with global growth indicators such as PMI peaking, surging inflation and slowing earnings momentum, the equity outlook near-term looked capricious.
"While markets look vulnerable in the short term, the conditions for medium-term outperformance of equities remain in place. We stick with our strategy, but at reduced levels of portfolio risk," JPMorgan Asset Management said.
Miner Lonmin
Centrica
UK real estate investment firms Land Securities
On the upside, software firms were chased higher.
Autonomy
Sage Group
Inmarsat
Written By: Reuters
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