U.K. Stocks Swing Between Gains and Losses; Lloyds Advances

By Sarah Jones

May 18 (Bloomberg) -- U.K. stocks swung between gains and losses as a rally in banks shares overshadowed a sell-off in mining companies after base metals prices fell.

Lloyds Banking Group Plc, which agreed to buy HBOS Plc at the peak of the credit crisis, jumped more than 5 percent after the lender said chairman Victor Bank will step down. Xstrata Plc and Kazakhmys Plc lost more than 4 percent as copper dropped on concern supply may outpace demand in China, the world’s largest user.

The FTSE 100 Index added 2.19, or less than 0.l percent, to 4,350.30 at 9:19 a.m. in London. The gauge has rebounded 24 percent from its low this year on March 3. The FTSE All-Share Index was little changed, while Ireland’s ISEQ Index added less than 0.1 percent.

Lloyds jumped 5.6 percent to 94.2 pence. The lender announced Chairman Victor Blank is planning to step down by June of next year after the government-brokered purchase of HBOS led it to fall into state control.

Alexander Leitch was named the bank’s deputy chairman with immediate effect.

Xstrata, the world’s fourth-largest copper producer, dropped 4.6 percent to 587.5 pence. Kazakhmys slid 4.4 percent to 605.5 pence while Antofagasta Plc lost 3.4 percent to 551 pence.

Copper in New York dropped for an eighth session on concern supply may outpace demand in China after domestic stockpiles climbed to the highest in more than two months.

The contract for July delivery on the Comex division of the New York Mercantile Exchange fell as much as 1.9 percent.

Rio Tinto Group dropped 5 percent to 2,530 pence as Exane lowered its recommendation for the shares to “neutral” from “outperform,” citing uncertainty over the mining company’s $19.5 billion proposed deal with Aluminum Corp. of China.

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