LONDON MARKETS: FTSE 100 Moves Lower, But HSBC Outperforms

By Carla Mozee, MarketWatch

U.K. stocks fell Monday, with shares of BP PLC struggling, but HSBC PLC outperformed after a report the company is looking at spinning off its U.K. retail bank.

The FTSE 100 was down 0.5% to 7,036.93, with only the financial and basic-materials sectors gaining.

BP PLC (BP) shares were down 0.9% after the U.K. government told the oil giant that it would oppose any potential foreign takeover (http://www.marketwatch.com/story/bp-told-uk-government-would-oppose-a-foreign-takeover-2015-04-27) of the British heavyweight. As oil prices have slid, there's been speculation about possible deal-making involving BP. This month, Royal Dutch Shell PLC agreed to take over BG Group PLC .

But HSBC shares topped the FTSE 100, rising 2.8% after a Sunday Times report the lender is weighing a deal valued at 20 billion pounds ($30.4 billion) that would see it spin off its retail bank. HSBC said on Friday that it's thinking about moving its headquarters out of London (http://www.marketwatch.com/story/hsbc-considers-quitting-the-uk-2015-04-24) as it assesses changes in the U.K. regulatory landscape. A move out of London could prompt Asia-focused HSBC to shed its British retail operations.

Read: HSBC may ditch London, but most other banks likely to stay put (http://www.marketwatch.com/story/hsbc-may-ditch-london-but-dont-expect-a-flood-of-lenders-to-leave-2015-04-24).

Centrica shares were down 0.2%. The parent company of British Gas said it's trading in line with guidance (http://www.marketwatch.com/story/centrica-trading-in-line-with-guidance-2015-04-27-34853946), with colder-than-normal weather in the U.K. and North America leading to higher energy consumption.

Meanwhile, retailer Sports Direct International's shares rose 1.4% following a RBC Capital Markets ratings upgrade to sector perform, from underperform. "Although we believe consensus EPS forecasts are too high owing to dollar-sourcing risk, valuation has corrected to more in line with historic averages and the sector," RBC Capital Markets analysts said.

Meanwhile, Greece's debt crisis is still being watched by investors. A small band of European ministers have raised the possibility of coming up with a "Plan B" (http://www.marketwatch.com/story/some-europe-ministers-suggest-plan-b-if-greece-talks-fail-2015-04-27) if talks on continued financing for Greece fail. While this suggestion was rejected by the Eurogroup chairman, Jeroen Dijsselbloem, the idea shows the extent to which many of the eurozone's decision makers no longer believe a deal on new bailout aid for the government in Athens can be sealed before the old one expires at the end of June.

Subscribe to WSJ: http://online.wsj.com?mod=djnwires