By Sara Sjolin, MarketWatch
LONDON (MarketWatch) -- U.K. stocks fell on Wednesday, as a
report confirmed that the economy contracted in the final quarter
of 2012, while oil firms dropped as oil prices moved lower.
The FTSE 100 index closed 0.2% lower at 6,387.56.
Oil firms weighed on the index, as crude-oil futures dropped.
Shares of BG Group PLC lost 1.5% and Royal Dutch Shell PLC (RDSB)
slipped 0.5%.
On the data front, a report from the Office for National
Statistics showed the U.K. economy shrank 0.3% in the fourth
quarter of 2012, unrevised from the previous estimate.
Banks were mostly lower, as the Financial Policy Committee in a
statement on U.K. banks' capital requirements identified a capital
shortfall of 25 billion pounds ($38 billion), which the sector
collectively has 12 months to address.
The figure is in the lower end of the FPC's initial estimate of
GBP24 billion to GBP60 billion, according to J.P. Morgan
Cazenove.
The analysts believe that the "shortfall mainly impacts domestic
U.K. banks" and can be covered through retained earnings, a
reduction in risk-weighted assets, disposals and issuance of
contingent convertibles.
Shares of Royal Bank of Scotland Group PLC (RBS) slumped 3.1%,
Standard Chartered PLC fell 0.4% and heavyweight HSBC Holdings PLC
(HBC) slipped 0.1%.
Prudential PLC fell 2.4%, Schroders PLC dropped 0.5% and British
Land Co. fell 0.5%. All three stocks went ex-dividend, meaning new
investors lose the right to the latest dividend.
Among other notable movers in London, shares of TUI Travel PLC
climbed 4%, as the travel firm said it continues to expect
underlying profit growth in fiscal 2013 toward the top end of
guidance of 7% to 10%.
Shares of John Wood Group PLC gained 0.8%, as the
energy-services firm won a three-year North Sea contract extension
from CNR International U.K. Ltd.
Outside the main index, ICAP PLC sank 6.3%. The interdealer
broker said it expects revenue for fiscal 2013 to come 13% below
last year's level.
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