By Carla Mozee, MarketWatch
LONDON (MarketWatch) — U.K. stocks moved higher Friday, with banking issues advancing on the prospect of a settlement between major financial firms and an industry regulator.
The U.K.’s FTSE 100 index /zigman2/quotes/210598409/delayed UK:UKX +0.56% ended up 0.2% to 6,649.39, reversing a loss as bank stocks strengthened. The move came after The Wall Street Journal reported the U.K.’s Financial Conduct Authority has spoken with six major banks about a potential settlement of a long-running investigation into possible manipulation of currency markets.
People familiar with the matter said the FCA has spoken with executive and lawyers at Barclays PLC, HSBC Holdings PLC, Royal Bank of Scotland Group PLC, as well as Citigroup Inc. /zigman2/quotes/207741460/composite C +2.64% , J.P. Morgan Chase & Co. /zigman2/quotes/205971034/composite JPM +1.73% and UBS AG .
In London, shares of HSBC /zigman2/quotes/203901799/delayed UK:HSBA +0.77% climbed 0.6%, Lloyds Banking Group PLC /zigman2/quotes/202285510/delayed UK:LLOY +2.36% /zigman2/quotes/200709414/composite LYG +2.26% added 0.6% and RBS picked up 0.3%.
But pressure remained on shares of Sports Direct International and supermarket chain Tesco PLC, whose stock was facing its worst weekly performance in more than two years.
Sports Direct dropped 2.7%, extending Thursday’s loss of 3.4%. The retailer, under owner Mike Ashley’s direction, made a 43 million pound ($70.1 million) bet via a put option that shares of embattled Tesco /zigman2/quotes/203761082/delayed UK:TSCO +1.06% will rise, it said.
Shares of Tesco lost 0.5%. The shares skidded 17% over the week because of a revelation Monday that an accounting error means its profit forecast was overestimated by £250 million. That is the stock’s biggest weekly fall since January 2012.
Off the FTSE 100, De La Rue PLC /zigman2/quotes/206574260/delayed UK:DLAR -1.20% shares stumbled 34% after the bank-note printer, whose customers include the Bank of England, issued a profit warning for the year, saying business conditions “have deteriorated”.
For the week, the FTSE 100 lost 2.8%. Stocks on Thursday were in part hurt after BOE Governor Mark Carney said the time for an interest-rate hike is moving closer. Such a move could come as early as next year, economists have said.