By Carla Mozee, MarketWatch

U.K. economy grows 0.3% in the first quarter

U.K. stocks were stuck in the red Tuesday after data showed the country's economy grew at a slower pace than anticipated in the first quarter, but the pound managed to bounce back from its losses.

The FTSE 100 fell 1.3% to 7,010.86, with only the mining and utilities sectors moving higher. European and U.S. stocks (DJI) (SPX) were also lower, with U.S. growth worries picking up pace ahead of the U.S. Federal Reserve's policy announcement Wednesday.

The FTSE 100 on Monday (http://www.marketwatch.com/story/ftse-100-moves-lower-but-hsbc-outperforms-2015-04-27) notched an all-time closing high of 7,103.98.

Pound: The pound (GBPUSD) hit an intraday low of $1.5174 after the Office for National Statistics said gross domestic product rose 0.3% from the fourth quarter of 2014, and by 2.4% year-over-year, missing consensus estimates of 0.6% and 2.7% growth rates, respectively.

But sterling didn't stay down for long, springing up to $1.5337 from $1.5225, where it was ahead of the GDP data. The move came as traders switched focus on the "clear divergence between the U.K. and the U.S." in monetary policy "because we've had a number of weeks of poor U.S. data," relative to U.K. reports, said Angus Campbell, senior analyst at FxPro.

The pound hit an intraday high of $1.5339, with the dollar falling further after U.S. consumer confidence fell in April, to its lowest level since December (http://www.marketwatch.com/story/consumers-less-confident-in-april-after-slowdown-in-hiring-2015-04-28). Sterling hasn't traded above $1.53 since early March.

Speculation that the Fed will hold off in raising interest rates in June (http://www.marketwatch.com/story/fed-not-ready-to-concede-it-wont-hike-this-summer-2015-04-27) has pushed the dollar (DXY) down against major rivals in recent sessions. The Fed will begin meeting on Tuesday and announce its policy decision Wednesday.

The U.K. growth figures are the last major reading on the economy before the May 7 general election, which looks to be the tightest race in decades. The pound's rebound after the GDP report "indicates that cable has perhaps the potential to rally a little bit further ahead of the election," said Campbell, but uncertainty surrounding the outcome "will still provide resistance for sterling."

Stocks: Among Tuesday's movers, Standard Chartered PLC dropped 3.5% after the Asia-focused bank said pretax first-quarter profit fell 22% to $1.47 billion (http://www.marketwatch.com/story/standard-chartered-considering-move-from-uk-2015-04-28), and that bad loans were up 80% from the same period a year ago. The bank also said it is keeping in consideration a move of its headquarters out of London as the U.K. government plans to raise a levy it charges to banks. But a formal review of such a move hasn't been launched, the company said.

Whitbread PLC fell 3.3% after the company said Chief Executive Andy Harrison will retire by February 2016 (http://www.marketwatch.com/story/whitbread-ceo-to-retire-2015-profit-rises-2015-04-28). The operator of the Costa Coffee and Premier Inn hotel chains also said profit and revenue rose in fiscal 2015.

BP PLC (BP) shares turned lower, by 1.1% alongside the broader market selloff. Shares had been higher earlier after the oil major said underlying replacement-cost profit for the first quarter came in at $2.58 billion (http://www.marketwatch.com/story/bp-posts-fall-in-profit-as-lower-oil-prices-bite-2015-04-28), above an expected $1.28 billion.

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