UKX FTSE 100 Index

By Carla Mozee, MarketWatch

U.K. construction PMI at lowest since 2013

U.K. stocks were hit hard Wednesday as shares of the London Stock Exchange Group PLC and mining heavyweight BHP Billiton PLC pushed the blue-chip benchmark toward a third consecutive decline.

The FTSE 100 lost 1.2% to 6,112.91, with only the industrial sector posting gains. The index on Tuesday dropped 0.9% (http://www.marketwatch.com/story/ftse-100-drives-toward-lowest-in-nearly-a-month-as-miners-sink-2016-05-03) and marked its lowest close since April 7.

Shares of London Stock Exchange (LSE.LN) descended to the bottom of benchmark during afternoon trade, falling 9.8%. The stock was on track for its sharpest drop since November 2008 after Intercontinental Exchange Inc. (ICE), which runs the New York Stock Exchange, decided against making a bid to acquire LSE.

LSE and Germany's Deutsche Boerse AG (DB1.XE) agreed in March to merge, with the deal expected to establish Europe's largest stock-exchange operator.

Also circling the bottom of the index was iron-ore heavyweight BHP Billiton PLC (BLT.LN) (BHP.AU) (BHP.AU) as shares dropped 6.4%. The move came after Brazilian federal prosecutors filed a civil lawsuit Tuesday over a catastrophic dam failure in November. Prosecutors are seeking up to 155 billion reais ($43.55 billion) (http://www.marketwatch.com/story/mining-firms-bhp-vale-face-44b-lawsuit-in-brazil-2016-05-03) for cleanup and remediation.

The dam was run by Samarco Mineração, a joint venture between BHP and Brazilian miner Vale SA (VALE5.BR) (VALE5.BR).

Elsewhere in the mining space, Randgold Resources Ltd. (RRS.LN) posted a 13% rise in first-quarter profit (http://www.marketwatch.com/story/randgold-profit-rises-on-higher-gold-output-2016-05-04-24853252), but the gold miner's shares slid 7.8%.

Meanwhile, shares of Royal Dutch Shell PLC (RDSB.LN) (RDSB.LN) shed 2.2%. The oil major said quarterly adjusted earnings fell to $1.6 billion (http://www.marketwatch.com/story/shell-profit-falls-but-beats-forecasts-2016-05-04-34851723) from $3.7 billion a year earlier, but that still beat analysts' expectations.

Grocers: Also in the red were shares of J Sainsbury (SBRY.LN). They fell 5% after the grocer cut its dividend payout (http://www.marketwatch.com/story/sainsbury-cuts-dividend-payout-2016-05-04) in a continued effort to manage costs. The U.K.'s second-largest grocer by market share swung to a fiscal year pretax profit of GBP548 million.

Separately, a survey from Kantar showed the top four U.K. grocers lost market share (http://www.marketwatch.com/story/top-four-uk-grocers-lose-market-share-2016-05-04)during the 12 weeks ended April 24 to German discounters Aldi and Lidl. Shares of Tesco PLC (TSCO.LN)(TSCO.LN) and Wm Morrison Supermarkets PLC (MRW.LN) fell 3.4% and 2.3%, respectively.

But topping the FTSE 100 was Next PLC (NXT.LN), driving up 6.2%. The apparel and household retailer cut its full-year forecast and posted a quarterly decline in brand sales. But a more than 4% rise in sales in its directory business helped lift Next's shares, said Hargreaves Lansdown in a note.

Direct Line Insurance Group PLC (DLG.LN) gained 0.3% as the company said quarterly gross premiums for ongoing operations rose by 4.2% (http://www.marketwatch.com/story/direct-line-quarterly-gross-premiums-rise-42-2016-05-04).

The pound switched slightly higher against the dollar, buying $1.1502. Sterling had declined after a Markit/CIPS report said U.K. construction activity slumped to the lowest since 2013 in April, to a reading of 52.0. Analysts polled by FactSet had expected a reading of 54.

(END) Dow Jones Newswires

May 04, 2016 08:41 ET (12:41 GMT)

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