By Barbara Kollmeyer, MarketWatch
MADRID (MarketWatch) -- London stocks were largely flat on
Monday, but banks got a lift after global regulators cut the
industry a break on leverage-ratio rules. Retailers stayed in the
spotlight, with shares of Debenhams PLC gaining on news a major
sporting retailer had taken a stake in the department-store
chain.
The FTSE 100 index traded flat at 6,746.81.
Barclays PLC (BCS) rose 2%, The Royal Bank of Scotland Group PLC
(RBS) added 2.5%, and Lloyds Banking Group PLC (LYG) gained 1.7%
after the Basel Committee on Banking Supervision eased a
leverage-ratio rule for banks on Sunday. Regulators said they had
revised the definition of its leverage ratio that will allow banks
to report lower levels of overall risks, in a move that lifts
pressure on banks to shed assets or raise more capital to meet that
requirement.
Investec analysts said in a note that they rate Barclays a buy,
adding that the Basel news "offers further comfort, albeit against
measures where Barclays's compliance was not, in our view, in
doubt. Expect a continuing relief rally as the Barclays 'capital
arbitrage' plays out," said the analysts.
Shares of Wm Morrison Supermarkets PLC rose more than 5%, making
it the FTSE 100's top gainer. The Financial Times reported over the
weekend that hedge fund Elliot Associates and other activist
investors are pressuring the supermarket chain to overhaul its
property portfolio. Morrison's declined to comment to the
newspaper.
Away from the main index, shares of Debenhams PLC rose close to
5% after Sports Direct International PLC said it has taken a 4.6%
stake in the retailer. Sports Direct shares fell 1%.
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