U.K. Stocks Erase Gains, Led Lower by HSBC, BT, Unilever Shares

By Sarah Jones

July 31 (Bloomberg) -- U.K. stocks fell, led by HSBC Holdings Plc, BT Group Plc and Unilever.

The FTSE 100 Index decreased 19.5, or 0.4 percent, to 5,401.2 at 1:43 p.m. in London. The FTSE All-Share Index also retreated 0.4 percent, while Ireland's ISEQ Index lost 2 percent.

Stocks in Europe fell after revised government figures showed the U.S. economy may have tipped into a recession in the last three months of 2007 as consumer spending slowed more than previously estimated and the housing slump worsened.

HSBC, Europe's biggest bank, slid 1.8 percent to 832 pence. Lloyds TSB Group Plc, the biggest bank that depends almost entirely on fees from lending in the U.K., decreased 4.4 percent to 292.5.

BT, the U.K.'s largest phone company, dropped as much as 15 percent to 168 pence, the biggest drop in more than eight years, after reporting a fourth straight quarterly profit decline and saying margins at the global services unit may drop.

Unilever slipped 7.8 percent to 1,392. The world's second- largest consumer-products company fell the most in five years after price increases for products ranging from Magnum ice cream to Omo detergents hampered sales.

To contact the reporter on this story: Sarah Jones in London at sjones35@bloomberg.net.