LONDON MARKETS: FTSE 100 Slips At Start Of 2015; RBS Shares Fall

By Carla Mozee, MarketWatch

LONDON (MarketWatch) -- U.K. stocks slipped Friday, with shares of Royal Bank of Scotland PLC falling after a report the bank may be facing a hefty fine in the U.S.

The FTSE 100 dropped 0.2% to 6,555.75. The benchmark had started higher in the first trading day of 2015, led by a 2.2% advance for energy engineering firm Weir Group PLC after its shares finished 2014 lower by 13%.

But the FTSE 100's gain was short-lived, in part as shares of RBS lost 1.1%. The Times newspaper on Friday said the bank could face fines exceeding 5 billion pounds ($7.77 billion) stemming from its involvement in the sale of bad mortgage-backed debt in the U.S., citing people familiar with the matter.

The FTSE 100 ended 2014 with a loss of 2.7%, the first yearly decline since 2011.

Shares of Lloyds Banking Group PLC , meanwhile, picked up 0.6% after Investec bumped up its rating on the bank to buy from hold. Its shares had dropped more than 12% from their peak in January 2014, but "2015 heralds lower conduct costs and greater predictability of (recovering) underlying earnings," said Investec in a Friday note.

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