(Reuters) -London’s FTSE 100 retreated from the previous session’s record high on Thursday, as a decline in the shares of HSBC weighed on the banking sector.
The blue-chip FTSE 100 fell 0.4%, while the mid-cap-focused FTSE 250 was up 0.05%.
HSBC dropped 5.4%, logging its steepest one-day drop in more than six months. The bank said it plans to buy out minority interests in Hong Kong’s Hang Seng Bank, where it holds a majority stake, in a deal worth HK$106.1 billion ($13.63 billion).
The broader banking sector weighed heavily on the market with a 3.7% decline.
Lloyds Banking Group and Merchant bank Close Brothers dropped 3.3% and 12.8%, respectively, after both the lenders warned they may need to set aside more cash to cover the costs related to a motor finance scandal.
Lloyds bank also announced plans to buy out Schroders’ 49.9% stake in their UK wealth management joint venture.
Aston Martin slumped 12.6% and was among the top losers in the FTSE 250, after European peer Ferrari’s 15.4% fall on disappointment over the luxury carmaker’s new long-term financial targets.
The broader European auto stocks fell 4.4%, marking their biggest daily fall since March.
The wider homebuilders index shed 1.9%, with Taylor Wimpey and Barratt Redrow dropping 4.6% and 3.6%, respectively.
A survey published by the Royal Institution of Chartered Surveyors said Britain’s housing market lost momentum for a third consecutive month, and its measures of buyer demand and agreed sales were stuck in the negative territory in September.
On the flip side, Volution Group closed at a record high, up 5.2%, after posting strong fiscal year results, helping the construction and materials sector inch up 0.9%.
The FTSE 100 has been rallying to record highs, on a boost from resource-linked stocks and banks this week. It recorded its best weekly showing since October 2008 on Friday as renewed investor interest in pharma stocks led them to regain some ground lost through the year.
Secure Trust Bank shares dropped 20.2% after the bank said it expects annual underlying profit before tax to fall below market expectations.
(Reporting by Sanchayaita Roy, Avinash P and Purvi Agarwal in Bengaluru; Editing by Vijay Kishore and Shailesh Kuber)
