U.K. Stocks Decline; Bradford & Bingley, Marks & Spencer Fall

By Adam Haigh

July 4 (Bloomberg) -- U.K. stocks fell, led by Bradford & Bingley Plc after TPG Inc. withdrew its offer to buy a stake in Britain's largest lender to landlords.

HBOS Plc declined as Societe Generale SA advised selling the shares. Marks & Spencer Group Plc fell for a seventh day, to the lowest since 2001, as Citigroup Inc. downgraded the stock to ``sell'' from ``buy.''

The benchmark FTSE 100 Index retreated 38.4, or 0.7 percent, to 5,438.2 at 8:44 a.m. in London, extending this week's decline to 1.6 percent its seventh straight weekly fall. The FTSE All- Share Index lost 0.6 percent today and Ireland's ISEQ Index dropped 0.5 percent.

Bradford & Bingley lost 3.7 percent to 58.75 pence, after briefly falling below the 55 pence strike price of its rights offering. The lender said it will raise 400 million ($793 million) in new capital without the buyout firm.

HBOS retreated 1.4 percent to 275.25 pence. Societe Generale cut its recommendation on the U.K.'s biggest mortgage lender to ``sell'' from ``hold.''

``Given the June downgrades to monoline insurers and continued weakening in the U.K. credit environment, we believe that interim results could disappoint the market,'' London-based analyst Asheefa Sarangi wrote in a note to clients.

Marks & Spencer lost 4.9 percent to 224.5, bringing this year's decline to 60 percent.

Citigroup lowered its 2009 and 2010 pretax profit estimates 17 percent and 29 percent respectively and slashed its price estimate on the stock 54 percent to 205 pence.

``Sector-wide revenue trends will weaken further as consumer demand patterns deteriorate,'' London-based analyst Richard Edwards wrote in a note.

Flying Brands Ltd., the U.K. mail-order flower seller that went public in 1993, slumped 11 percent to 46 pence after saying it will close its U.S. Greetings Direct business following ``extremely disappointing'' test results in June.

To contact the reporter on this story: Adam Haigh in London at ahaigh1@bloomberg.net