LONDON MARKETS: FTSE 100 Slides As BOJ Shock Ripples Through Markets

By Carla Mozee, MarketWatch

Lloyds shares fall sharply after its profit plunges

U.K. stocks dropped Thursday, tracking declines in Asia markets after the Bank of Japan's surprise decision not to launch more stimulus for the world's third-largest economy.

The blue-chip FTSE 100 index fell 0.7% to 6,278.20, in line for its first loss in three sessions. The benchmark on Wednesday rose 0.6% (http://www.marketwatch.com/story/ftse-100-sags-as-banks-miners-lose-ground-2016-04-27), helped by rising oil prices.

U.K. and other European equity markets were hit Thursday after Bank of Japan Governor Haruhiko Kuroda's "decision to keep interest rates on hold and stimulus measures unchanged dashed market expectations," said Tobias Davis, U.K. currency strategist at Western Union Business Solutions, in a note.

"Policy makers look to be taking more time to assess the impact of negative interest rates and now anticipate the inflation target of 2% will be reached during fiscal 2017," he added.

The Nikkei 225 index closed 3.6% lower and the yen surged against the dollar (http://www.marketwatch.com/story/yen-rips-higher-against-dollar-after-boj-shocks-market-with-no-action-2016-04-28) after the surprise move by Japan's central bank.

Late Wednesday, the U.S. Federal Reserve kept interest rates unchanged (http://www.marketwatch.com/story/fed-stands-pat-and-is-silent-about-future-of-interest-rates-2016-04-27) and gave little clue on the timing of its next rate hike, but it toned down its concerns about the global economy.

Stock movers: Among the worst performances came from Lloyd's Banking Group PLC (LLOY.LN) (LLOY.LN) shares, down 4.2%. The bank said Thursday its first-quarter net profit fell 44% to GBP531 million ($773.72 million), hurt by restructuring charges (http://www.marketwatch.com/story/lloyds-profit-down-44-on-restructuring-charges-2016-04-28) and the cost of buying back high interest paying bonds.

(http://www.marketwatch.com/story/lloyds-profit-down-44-on-restructuring-charges-2016-04-28)WPP PLC (WPP.LN) shares were off 1.2%, even as the advertising giant posted an 11% rise in first-quarter revenue. (http://www.marketwatch.com/story/wpp-revenue-up-11-on-growth-in-key-markets-2016-04-28)

Meanwhile, shares of Berkeley Group Holdings PLC (BKG.LN) fell 3.8% after Credit Suisse reportedly downgraded the home builder's rating to underperform.

Among gainers in the U.K., Anglo American PLC (AAL.LN) shares were up 3% after the metals producer agreed to sell some assets in Brazil (http://www.marketwatch.com/story/anglo-american-to-sell-brazilian-units-2016-04-28) for $1.5 billion.

(END) Dow Jones Newswires

April 28, 2016 04:18 ET (08:18 GMT)

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