U.K. Stocks Decline; Royal Dutch Shell, BHP, Aviva Lead Drop

By Adam Haigh

March 5 (Bloomberg) -- U.K. stocks fell ahead of the Bank of England’s interest rate decision as declining crude and copper prices pushed oil and mining companies lower and Aviva Plc posted a loss for 2008.

Royal Dutch Shell Plc and BHP Billiton Ltd. lost more than 2 percent as China’s Premier Wen Jiabao refrained from announcing an expansion of the government’s stimulus package. Aviva slumped 13 percent after the U.K.’s biggest insurer reported a loss for 2008. The Bank of England may cut its benchmark interest rate by a half point to 0.5 percent, a Bloomberg survey of economists showed.

Investors are “switching their focus toward today’s important Bank of England decision,” said Joshua Raymond, market strategist at City Index in London. “We expect volumes to be low until the BoE decision.”

The benchmark FTSE 100 Index lost 48.56, or 1.3 percent, to 3,597.31 at 9:11 a.m. in London, paring yesterday’s steepest rally in six weeks. The FTSE All-Share Index slid 1.3 percent and Ireland’s ISEQ Index slipped 1.3 percent.

Governments from the U.S. to Australia and China have introduced measures this year in an attempt to revive their economies. More than $1.1 trillion in losses at financial firms worldwide and disappointing earnings from Lloyds Banking Group and BT Group Plc pushed investors out of equities as the FTSE 100 lost 18 percent this year.

Shell, Europe’s largest oil producer, slid 2.2 percent to 1,426 pence. Crude oil for April delivery fell as much as 59 cents, or 1.3 percent, to $44.79 a barrel in electronic trading on the New York Mercantile Exchange.

BHP Billiton, the world’s largest mining company, lost 2.9 percent to 1,138 pence, as copper prices retreated. The shares rallied 13 percent yesterday.

Aviva lost 13 percent to 249 pence as it reported an 885 million pound net loss for 2008, after a 1.5 billion-pound profit the previous year.

The following stocks also rose or fell in the U.K. market. Stock symbols are in parentheses.

Aggreko Plc (AGK LN) rallied 49.5 pence, or 13 percent, to 426.75. The world’s largest provider of mobile generators said full-year profit rose to 122.7 million pounds ($173.9 million) and the company made a “very strong” start to 2009.

Michael Page International Plc (MPI LN), the U.K.’s second- largest recruitment company, lost 8.5 pence, or 4.2 percent, to 193.25 after saying full-year profit dropped 4.3 percent as it was hurt by the global recession.

Premier Foods Plc (PFD LN) rallied 5.75 pence, or 20 percent, to 34.25 pence. The second-largest U.K. bread baker plans to raise 379 million pounds ($537 million) in a share sale.

Restaurant Group Plc (RTN LN) slid 2 pence, or 1.7 percent, to 118 pence. UBS AG cut is recommendation on the U.K. owner of the Frankie and Benny’s chain to “neutral” from “buy” in a note to clients today.

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