UK's FTSE 100 lag as energy stocks fall; DS Smith, Diploma jump

Britain's FTSE 100 inched lower on Wednesday, hurt by declines in energy and bank stocks, but the losses were limited by a jump in shares of paper and packaging firm DS Smith and specialised products and service distributor Diploma on deal-related news. Both the export-heavy FTSE 100 and the domestically oriented FTSE 250 was down 0.3% by 0933 GMT.

Britain's FTSE 100 inched lower on Wednesday, hurt by declines in energy and bank stocks, but the losses were limited by a jump in shares of paper and packaging firm DS Smith and specialised products and service distributor Diploma on deal-related news.

Both the export-heavy FTSE 100 and the domestically oriented FTSE 250 was down 0.3% by 0933 GMT. The energy sector slid 1.2% as oil prices fell for a second day after a report showed U.S. crude stockpiles have increased.

Bank stocks also dropped 0.9%. The FTSE 100 index touched a one-year high last week following dovish signals from major central banks, including the Bank of England (BoE), but the rally has lost some steam this week.

"It's just exhaustion. It's just that the rally needs time to regroup. The driver is particularly the long weekend looming and the end of the quarter. It needs to pause, a refresh essentially," said Chris Beauchamp, chief market analyst at IG Group. Market participants remained focussed on a key reading of the U.S. personal consumption expenditure price index (PCE), the Federal Reserve's preferred inflation gauge, due on Friday, when most global markets will be shut for the Good Friday holiday.

"To an extent, people are waiting to see what comes through in terms of the U.S. figures, although the fact it is on a bank holiday does sort of complicate matters," added Beauchamp. DS Smith jumped 6.9% after the firm confirmed it was in discussions with International Paper over an all-stock buyout for 5.72 billion pounds ($7.22 billion) from its U.S.-listed rival.

Also capping losses, specialised product and service distributor Diploma soared 11.2% after the company said it would acquire Peerless Aerospace Fastener for 236 million pounds ($297.88 million). Among mid-caps, TI Fluid Systems plunged 16.1% after the automotive fluid storage maker raised gross proceeds of about 67.5 million pounds ($85.26 million) at a discounted placement.

Investors will also watch for the UK's fourth-quarter gross domestic product (GDP) readings due on Thursday. ($1 = 0.7917 pounds)

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)